NASDAQ: FEED

2025
Reverse Stock Splits

On
March 12, 2025, the Company filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of Delaware
to effect a 1-for-11 reverse stock split of the shares of its common stock either issued and outstanding or held by the Company as treasury
stock, effective as of 4:05 p.m. (Delaware time) on March 13, 2025 (the “March 2025 Reverse Stock Split”).

On
August 8, 2025, the Company filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of Delaware
to effect a 1-for-10 reverse stock split of the shares of its common stock either issued and outstanding or held by the Company as treasury
stock, effective as of 4:05 p.m. (Delaware time) on August 11, 2025 (the “August 2025 Reverse Stock Split” and together with
the March 2025 Reverse Stock Split, the “Reverse Stock Splits”).

1

ENvue’s
Business

ENvue
is a medical device company engaged in the research, development, production, marketing, and sale of medical devices in the field of
enteral feeding and is in the growth stage of commercializing its products. Guided by its mission to be an innovation leader in the field
of enteral feeding, ENvue is focused on improving patient outcomes across the continuum of care, encompassing the development of advanced,
personalized navigation solutions, responding to the challenges of the ever-hanging healthcare environment, while continuously focusing
on the customer. The medical device marketed and sold by ENvue is the FDA 510(k)-cleared ENvue System, which assists in the insertion
of a feeding tube into the digestive system of patients requiring nutrition during hospitalization through intra-body navigation (the
“ENvue System”).

The
most common way to provide nutrition to patients during hospitalization is through a feeding tube inserted through the nose or mouth
into the stomach or small intestine (known as “enteral nutrition”). Around 43 million feeding tubes are inserted annually
worldwide (Enteral feeding devices, Global forecast to 2025; Market & Markets (“Markets & Markets”)). Between 2-5%
of these tubes are placed in the lungs leading to a 30% chance of a collapsed lung or possible fatality (Aguilar-Nascimento, Kudsk, JPEN
J Parenter Enteral Nutr 2007; Bourgault, Margo Halm Am J Crit Care. 2009). Furthermore, between 20-50% of hospital patients (Bellanti,
Francesco, et al. “Malnutrition in hospitalized old patients: screening and diagnosis, clinical outcomes, and management.”
Nutrients 14.4 (2022): 910.), including those in the intensive care unit (“ICU”), are malnourished, with malnutrition having
a significant impact on both clinical outcomes and healthcare systems.

Recognizing
the critical need for early feeding in small bowel and lower the risk of tube misplacement, ENvue applied its expertise in electromagnetic
navigation and enteral feeding to develop the ENvue System. The ENvue System, together with a dedicated feeding tube for the system,
positioning sensors, and other components developed by ENvue, is designed to efficiently and safely insert the feeding tube into the
patient’s digestive system for the purpose of providing nutrition. Furthermore, ENvue’s solution aims to provide faster nutrition
delivery to the patient, potentially improving their condition, and facilitating the insertion of the feeding tube into the small intestine,
which we believe has advantages over insertion into the stomach. ENvue believes that the ENvue System offers an efficient solution for
feeding tube insertion and has the ability to transform enteral feeding tube insertion.

In
February 2019, ENvue received 510(k) market clearance from U.S. Food and Drug Administration for the commercial marketing and sale
of the ENvue System in the United States for use in adults (aged 22 and over)1. During the first quarter of 2020, ENvue
began marketing and selling the ENvue System and its dedicated feeding tubes, and it is currently in the initial growth
commercialization phase of these products in the U.S.

1
According to FDA guidelines, an adult is defined as a person who is 22 years of age or older.

ENvue
Strategy

ENvue’s
strategy is focused on improving the safety, efficiency, and reliability of enteral feeding tube placement and management through the
development and commercialization of navigation-enabled medical devices and related disposable products. The Company is developing a
platform intended to assist clinicians in the real-time placement and verification of enteral feeding tubes, addressing longstanding
clinical challenges associated with traditional placement methods that may rely on blind insertion techniques and subsequent confirmation
procedures.

The
Company’s current commercial efforts are primarily focused on the United States acute care hospital market. ENvue is in the growth
commercialization phase of the ENvue System, a navigation platform designed to provide clinicians with real-time guidance during
feeding tube placement. The system is used in conjunction with proprietary disposable enteral feeding tubes designed to integrate with
the platform.

In
addition to feeding tubes, the Company offers enteral feeding accessories, including syringes and other related products intended to
support enteral feeding procedures. The Company’s business model includes the sale of the navigation system together with recurring
sales of disposable products used in connection with clinical procedures.

2

As
of the date of this Annual Report on Form 10-K, ENvue has established commercial engagements with multiple hospitals in the United States
for the evaluation, implementation, and clinical use of the ENvue System and related disposable enteral feeding tubes and accessories.
The Company’s commercialization strategy includes expanding its sales, marketing, and clinical education activities to support
increased adoption of the system and its associated disposable products across hospital intensive care units and other clinical settings
where enteral feeding procedures are performed.

Over
time, the Company intends to broaden the capabilities of its navigation platform and expand its product portfolio to address additional
clinical applications related to enteral access and other intrabody navigation procedures. In addition, ENvue may seek to expand its
commercialization activities into additional international markets, subject to obtaining applicable regulatory approvals and establishing
appropriate distribution and commercialization infrastructure.

ENvue
Products

I.
Enteral
Feeding - General Background

Enteral
feeding is the most common method of providing liquid nutrition and certain types of medications to critically ill patients who are hospitalized
and require nutritional support, such as those on ventilators, post-surgery patients, patients with disabilities or conditions that prevent
them from eating fully or partially, and premature infants (Welch, Teresa D. “Nutrition options in critical care unit patients.”
Critical Care Nursing Clinics 30.1 (2018): 13-27 (“Welch 2018”); Milsom, S. A., et al. “Naso-enteric tube placement:
a review of methods to confirm tip location, global applicability and requirements.” World journal of surgery 39 (2015): 2243-2252
(“Milsom 2015”); de Aguilar-Nascimento, José Eduardo, and Kenneth A. Kudsk. “Use of small-bore feeding tubes:
successes and failures.” Current Opinion in Clinical Nutrition & Metabolic Care 10.3 (2007): 291-296 (“de Aguilar-Nascimento
and Kudsk 2007”); Koyfman, Leonid, et al. “The Placement of Post-pyloric Feeding Tubes Using DRX-Revolution Mobile X-Ray
System in an ICU. A Case Series.” The Journal of Critical Care Medicine 2.3 (2016): 131-134). The prevalence of malnutrition among
critically ill patients ranges from 30% to 50%, with some patients arriving at the hospital already malnourished and others potentially
developing malnutrition during hospitalization (Market & Markets; Barker, Lisa A., Belinda S. Gout, and Timothy C. Crowe. “Hospital
malnutrition: prevalence, identification and impact on patients and the healthcare system.” International journal of environmental
research and public health 8.2 (2011): 514-527; Wischmeyer, Paul E. “Malnutrition in the acutely ill patient: is it more than just
protein and energy?” South African Journal of Clinical Nutrition 24.3 (2011): S1-S7). It should be noted that there are critically
ill patients who, due to their medical condition, are unable to receive regular nutrition for many days.

Delays
in providing nutrition to patients can lead to a deterioration in their condition, as early insertion of the feeding tube and timely
provision of nutrition can, in most cases, reduce the severity of the illness, help preserve the integrity of the intestinal lining,
reduce infections and complications, improve gastrointestinal motility, and enhance immune response (Wang, Honggang, et al. “Early
enteral nutrition reduced postoperative ileus and improved the outcomes in patients with emergency intestinal surgery: results from a
propensity score analysis.” Int J Clin Exp Med 10.4 (2017): 7040-7048). Moreover, early provision of nutrition may improve the
patient’s condition and recovery rate, reduce possible complications, shorten the stay in intensive care, and even lower mortality
rates (Welch 2018). Consequently, early provision of nutrition may also result in significant cost savings for the hospital. Therefore,
in cases where regular nutrition cannot be provided to the patient and enteral feeding is required, it should be provided as soon as
possible (within 24-48 hours).

Enteral
nutrition is administered, among other methods, by inserting a feeding tube through the patient’s nose or mouth into the stomach
or small intestine (Tatsumi, Hiroomi. “Enteral tolerance in critically ill patients.” Journal of intensive care 7.1 (2019):
30 (“Tatsumi 2019”)). Each year, approximately 43 million nasogastric feeding tubes are inserted worldwide (about 14 million
of them in the United States) (Market & Markets). In general, according to FDA guidelines, a feeding tube inserted into a patient
should not remain in place for more than 30 days. However, hospitals tend to remove/replace the tube more frequently (for example, in
cases of tube blockage due to improperly dissolved medications or accidental disconnection of the tube by the patient).

Feeding
through a tube inserted through the patient’s nose or mouth directly into the patient’s small intestine (Post-Pyloric Feeding),
where nutrients are absorbed, requires more precise insertion of the tube, and offers several advantages over gastric feeding. Feeding
directly into the small intestine may reduce the risk of medical complications, involve a lower risk of gastric reflux and respiratory
infections and complications, provide higher caloric intake for the patient, and require a shorter stay in the intensive care unit (Welch
2018; Sajid, M. S., et al. “An integrated systematic review and meta-analysis of published randomized controlled trials evaluating
nasogastric against postpyloris (nasoduodenal and nasojejunal) feeding in critically ill patients admitted in intensive care unit.”
European journal of clinical nutrition 68.4 (2014): 424-432; Jiyong, Jing, et al. “Effect of gastric versus post-pyloric feeding
on the incidence of pneumonia in critically ill patients: observations from traditional and Bayesian random-effects meta-analysis.”
Clinical Nutrition 32.1 (2013): 8-15; Tatsumi 2019. As detailed below, the ENvue System is designed to facilitate the insertion of the
feeding tube through the patient’s nasal or oral route into the stomach or directly into the small intestine with accuracy and
efficiency.

3

Limitations
of Existing Alternative Enteral Feeding Methods

To
the best of ENvue’s knowledge, the most common method currently used for inserting feeding tubes through the nose or mouth is the
“blind” method, i.e., without visibility inside the patient’s body to facilitate accurate navigation and placement.
While for many years the “blind” insertion method was considered harmless, it has been found that this method can cause serious
and even fatal complications in patients (Market & Markets). Common complications among patients with feeding tubes inserted via
the “blind” method include incorrect insertion of the tube into the respiratory tract instead of the esophagus, aspiration
(entry of food, saliva, or stomach acids into the respiratory tract), lung collapse, sinus injuries, nosebleeds, and more (Rassias, Athos
J., Perry A. Ball, and Howard L. Corwin. “A prospective study of tracheopulmonary complications associated with the placement of
narrow-bore enteral feeding tubes.” Critical Care 2 (1998): 1-4; Prabhakaran, S., et al. “Nasoenteric tube complications.”
Scandinavian Journal of Surgery 101.3 (2012): 147-155 (“Prabhakaran 2012”)). According to studies, of the approximately 43
million feeding tubes inserted worldwide each year, about 1.72 million tubes are mistakenly inserted into patients’ lungs, and
of these, about 40% of patients suffered from pneumothorax (air accumulation in the chest cavity, impairing the breathing process) (de
Aguilar-Nascimento, Jose Eduardo, and Kenneth A. Kudsk. “Clinical costs of feeding tube placement.” Journal of Parenteral
and Enteral Nutrition 31.4 (2007): 269-273 (“de Aguilar-Nascimento 2007”); Burns, Suzanne M., et al. “Detection of
inadvertent airway intubation during gastric tube insertion: capnography versus a colorimetric carbon dioxide detector.” American
Journal of Critical Care 15.2 (2006): 188-195). Due to the high frequency of feeding tube use, experts believe that even a relatively
small percentage of cases where the feeding tube is incorrectly inserted could impact a very large number of people (Prabhakaran 2012).

Incorrect
insertion of the feeding tube into the lungs can have further serious consequences for the patient, including worsening of their medical
condition, which could lead to medical harm and even death, extended hospitalization, significant costs for the hospital, and legal claims
(de Aguilar-Nascimento 2007; Sparks, Dorothy A., et al. “Pulmonary complications of 9931 narrow-bore nasoenteric tubes during blind
placement: a critical review.” Journal of Parenteral and Enteral Nutrition 35.5 (2011): 625-629).

It
should be noted that due to technical failures and the prolonged time required for blind insertion of the feeding tube, attempts to insert
feeding tubes directly into the small intestine can result in delays in providing the necessary nutrition to the patient (as mentioned
above, providing early nutrition to the patient may improve their condition and prevent medical complications).

Given
the difficulties, risks, and possible complications associated with the blind insertion method of feeding tubes, as detailed above, the
duration of insertion, and the challenge of inserting it into the small intestine using this method, there is a noticeable trend towards
using alternative methods for inserting feeding tubes using technological or other means (Koopmann, Matthew C., et al. “A team-based
protocol and electromagnetic technology eliminate feeding tube placement complications.” Annals of surgery 253.2 (2011): 297-302
(“Koopman 2011”)), instead of relying on the blind insertion method, as detailed below.

There
are significant limitations in the existing alternative methods for inserting feeding tubes into patients and the various methods used
to verify that the blindly inserted feeding tube is located in the patient’s digestive system and not in the respiratory tract,
the main ones of which are detailed below.

Methods
for Verifying the Placement of a Blindly Inserted Feeding Tube

Among
the primary methods are measuring the distance of the tube from the insertion site, measuring the volume of aspirate, measuring the pH
level of the liquid aspirated from the tube (to check acidity levels to ensure it is gastric juices), checking the carbon dioxide level
of the air aspirated from the tube (to ensure the tube is not located in the lungs), and using an X-ray (fluoroscopy), with the latter
generally considered more accurate than the others (de Aguilar-Nascimento and Kudsk 2007; Milsom 2015). However, these methods may not
always identify errors accurately and in a timely manner, and they allow correction of incorrect insertion and placement of the tube
in the digestive system only after it has already been inserted into the lung, which may have caused pneumothorax or lung perforation
due to the insertion of the tube into the respiratory tract (Powers, Jan, et al. “Elimination of radiographic confirmation for
small-bowel feeding tubes in critical care.” American Journal of Critical Care 22.6 (2013): 521-527.). Furthermore, the X-ray method
has additional drawbacks, such as additional technical costs, prolonged time consumption, delayed patient nutrition, and radiation exposure.
Additionally, the pH measurement method has various limitations, such as respiratory burden and, primarily, inaccuracies due to medication
or other chemical treatment that affects the acidity level in the patient’s digestive system (Bourgault, Annette M., and Margo
A. Halm. “Feeding tube placement in adults: safe verification method for blindly inserted tubes.” American Journal of Critical
Care 18.1 (2009): 73-76).

4

II.
The
ENvue System

The
core application of ENvue’s operations is the ENvue System, which is a system for monitoring and correctly positioning feeding
tubes in patients who require nutritional support during hospitalization. The system includes the main unit (the system body), disposable
(consumable) ENvue Feeding Tubes designed exclusively for use with the system, sensors, and additional components developed by ENvue.
These components, when used together, are intended to facilitate more efficient, faster, and safer insertion of the feeding tube into
the patient’s digestive system. The system uses electromagnetic waves transmitted to the upper torso of the patient, utilizing
sensors embedded in the dedicated feeding tube and sensors attached to the patient’s body during the procedure, enabling monitoring
and control of the feeding tube’s insertion path in an effort to facilitate proper placement into the GI tract bypassing the airways.
It should be noted that using the ENvue System will not guarantee the absence of medical errors or adverse events in connection with
a feeding tube placement. For example, five serious adverse events have been reported in connection with tubes inserted in patients’
lungs or pulmonary airway using the ENvue System. After investigation and review of placement files, ENvue believes the reported serious
adverse events were caused by user error.

Product
Components and Features

The
system components are described in greater detail below:

System
Body

The
system body includes several components, including a screen displaying the feeding tube’s position and an electromagnetic field
generator mounted on an adjustable arm. Before inserting the feeding tube and until the procedure is complete, the generator is positioned
towards the patient’s chest and upper abdomen, emitting low-frequency electromagnetic waves throughout the procedure (see the
illustration below).

Once
the feeding tube is inserted, the passive electromagnetic sensor inside the tube enters the generator’s transmission area,
which detects the sensor’s movement and displays it graphically on the screen.

Reference
Sensor

An
external, reusable sensor connected to the system and attached to the patient’s body in the armpit area is used to reference
the feeding tube’s position within the patient’s body at any given moment. The reference sensor allows the system to
remain accurate even if the patient moves during the procedure (due to coughing, etc.).

Feeding
Tube (Disposable Component)

The
dedicated feeding tube developed by ENvue is designed specifically for use with the ENvue System and is intended for placement in
the stomach or small intestine. The feeding tube is single-use and features a dual connection: one for the nutrition source and another
for the ENvue System.

During
the procedure, the other end of the tube is inserted through the nose into the patient’s body. A passive electromagnetic sensor
embedded in the tube allows the tube’s path within the patient’s body to be tracked on the system’s screen.

5

As
of now, ENvue’s feeding tube has been cleared in three different diameters: 8 Fr., 10 Fr., and 12 Fr.3

3
Fr. 1 = 0.3 mm.

ENvue
System Usage

The
ENvue System is used as follows: Throughout the feeding tube insertion procedure, the ENvue System emits electromagnetic waves toward
the patient’s upper body. Using the reference sensor connected to the system, the operator marks several anatomical points on the
patient’s upper body and attaches an additional location sensor to the side of the patient’s chest, allowing the system to
remain accurate even when the patient moves or coughs during the procedure. The operator then inserts the dedicated feeding tube for
the system through the patient’s nose or mouth into the esophagus and further into the digestive system (small intestine or stomach)
while viewing the tube’s path on the system’s screen from several angles and receiving real-time alerts if the system detects
the tube entering the patient’s airways, which is intended to enable the operator to immediately correct the tube’s insertion
path.

To
the best of ENvue’s knowledge, using the ENvue System allows the feeding tube insertion procedure to be completed within approximately
5-30 minutes on average, depending on the patient’s condition, the operator’s technical ability, and other factors. In comparison,
the time required for blind insertion of a feeding tube through the nose or mouth, based on ENvue’s estimate and medical research,
may take about 11-60 minutes (approximately 42 minutes on average) (Smithard, David, et al. “Electromagnetic sensor-guided enteral
access systems: a literature review.” Dysphagia 30 (2015): 275-285). Additionally, research shows that the time from blind insertion
of a feeding tube to the start of feeding the patient may take several hours, partly due to the need to verify the tube’s correct
placement in the digestive system using X-rays (Gray, Rebecca, et al. “Bedside electromagnetic-guided feeding tube placement: an
improvement over traditional placement technique?” Nutrition in Clinical Practice 22.4 (2007): 436-444).

Using
alternative methods as mentioned during the use of the ENvue System is not required by the FDA and is subject to the specific hospital’s
policy.

6

For
illustration purposes, below are diagrams demonstrating the use of the ENvue System:

Transmission
of electromagnetic waves by the system to the patient’s upper body throughout the procedure

Real-time
visualization of the feeding tube’s insertion path within the patient’s body from multiple angles

7

Receiving
an alert for the detection of improper insertion of the feeding tube

Marketing
Strategy

The
system, including the dedicated feeding tubes, is marketed to hospitals, and was designed and developed after ENvue received feedback
from healthcare professionals in the United States regarding their needs, which helped tailor the system to the market.

Using
the technology on which the system is based, it monitors the precise location of the feeding tube within the patient’s body, from
the moment it is inserted through the patient’s nose or mouth until it reaches the stomach or small intestine, and displays its
location in real-time through an imaging display of the patient’s body from several different angles on a screen. The display of
the patient’s body on the screen is made possible by using a reference sensor and marking anatomical landmarks on the patient’s
body at the beginning of the procedure.

In
cases where the system detects a deviation in the tube’s path towards the patient’s trachea, an immediate alert appears on
the screen. This allows the operator to correct the feeding tube’s insertion path immediately.

As
part of its operations ENvue has marketed the ENvue System to its customers and continuously supplied them with consumable feeding tubes,
which are designed for use exclusively with the system. At the beginning of 2020, ENvue began marketing the system and feeding tubes
to hospitals in the United States, following the FDA clearance received in February 2019 for marketing the product in this territory
for adults (aged 22 and older) only.

The
unique solution developed by ENvue as part of the ENvue System is intended to address, among other things, the risks and costs associated
with existing methods for inserting the feeding tube into the patient and the time required until the start of feeding due to delays
caused by the need to verify the tube’s placement in the patient, as described above. Using the ENvue System, including the dedicated
feeding tube developed by ENvue, it is possible to monitor the feeding tube insertion path into the patient and receive a real-time alert
if the tube is inserted into the patient’s respiratory tract. ENvue believes the system design may allow for accurate, reliable,
and efficient tube insertion for the patient and ease of use for the operator, which could potentially reduce the time required to insert
the feeding tube and thereby reducing the time until nutrition is provided to the patient.

4
The clinical trial lasted about a year, during which ENvue was required to obtain the consent of the patients or their family members
(depending on the patient’s medical condition) for participation in the trial.

8

Additionally,
ENvue believes using the system may minimize the risk of complications resulting from improper tube insertion and the associated costs
for the hospital, as well as shorten the patient’s hospitalization duration and prevent exposure to radiation from performing multiple
X-ray examinations to verify the tube’s placement. Furthermore, using the system screen that displays the patient’s body
dimensions, ENvue believes it is easier to properly insert the feeding tube into the patient’s small intestine on the first attempt,
which, as mentioned, is preferable to gastric tube insertion.

III.
Nutriseal
Nasogastric Aspiration Tube

ENvue
also has another product in the field, a tube designed for enteral nutrition called the Nutriseal Nasogastric Aspiration Tube (NGAT).
This tube employs a sealing technique to prevent stomach acid from refluxing into the esophagus and to prevent aspiration of stomach
contents into the respiratory tract. NGAT has been cleared for marketing in the U.S. and was approved in the European Union; however,
as of now, ENvue is not manufacturing or marketing it, and the EU approval is currently not valid.

NGAT
is a feeding tube developed by Nutriseal Limited Partnership (the rights to which were transferred to ENvue shortly after its establishment
in 2017. NGAT is intended to serve as an enteral feeding tube for patients needing nutritional support and for other uses in hospitalized
patients. NGAT’s uniqueness compared to other feeding tubes lies in its sealing technique around the patient’s esophagus,
which can significantly reduce the risks associated with nasoenteral feeding (feeding through a tube inserted through the nose into the
stomach or small intestine), including esophageal reflux (the backflow of stomach acid up the esophagus) and aspiration (inhalation)
of stomach contents and food particles that may enter the lungs and cause severe health complications, including pneumonia.

NGAT
was developed and designed for use in various medical procedures, such as enteral feeding, gastric lavage, and gastric decompression,
while reducing the risk of esophageal reflux or aspiration. It should be noted that NGAT, in its current version, is intended for insertion
without a navigation system, but future iterations, if any, may be able to be used as a feeding tube connected to the ENvue System for
navigation during the tube insertion process, subject to applicable FDA clearance(s). Additionally, ENvue has developed other NGAT-b
components, for which, as of now, ENvue has not submitted applications for regulatory approval.

Product
Components and Features

NGAT
includes a feeding tube composed of a single central internal tube for delivering nutrients into the stomach and six internal suction
tubes surrounding the central internal tube (the “internal suction tubes”). NGAT contains small openings along its length,
which, after the tube is inserted into the patient’s body, are positioned along the esophagus and release low negative air pressure,
creating a suction action that causes the esophageal walls to contract inward, forming a seal around the tube that prevents stomach fluids
from refluxing into the esophagus and aspirating refluxed stomach fluids (the “aspiration mechanism”).

NGAT
is designed with two sealed suction areas located at the end of the tube inserted into the patient’s body, where stomach fluids
accumulate. The internal suction tubes are divided into two sets of three suction tubes each, with each set connected to a different
suction area. The operator can regulate the suction between the two sealed suction areas using a branched valve located at the end of
the tube that remains outside the patient’s body, allowing suction to be applied to one sealed suction area at a time.

NGAT
can be connected to standard hospital suction equipment, and its use does not require special equipment. This connection enables the
operation of the aspiration mechanism as well as performing gastric lavage procedures.

Marketing
Strategy

ENvue
may market NGAT in the U.S. for adult treatment only (aged 22 and above) (FDA clearance in the 510(k) pathway). NGAT also received the
European Union CE Mark for marketing in EU countries, which is not valid as of February 25, 2019, and several patents related to this
product have been registered.

ENvue
is not manufacturing or marketing NGAT as part of its business strategy to focus its operations and marketing efforts in the coming years
on the introduction and integration of the ENvue System into relevant markets. ENvue’s decision regarding the commercialization
of NGAT will be reviewed regularly by management and will be determined, among other factors, by the financial resources available to
ENvue, the pace of ENvue System adoption in the market, and the potential impact of various factors on ENvue’s operations (including
the risk factors to which ENvue is exposed). Therefore, there is currently no certainty regarding the timing of NGAT’s commercialization
by ENvue. It should be noted that NGAT can potentially be used with the ENvue System, subject to the necessary FDA clearance(s), and
ENvue may consider integrating NGAT within the ENvue System’s use and submitting an updated 510(k) notification to FDA if it decides
to commercially manufacture and market NGAT in the future.

9

IV.
New
Products

ENvue
Feeding Tube and System for Use in Children and Preterm Infants

This
is a navigation system with dedicated feeding tubes of smaller diameters, designed for use in children and preterm infants. ENvue has
completed the initial product development process and will begin preparations for conducting a clinical trial as part of the FDA clearance
process.

Imaging
Navigation (ENvue Plus)

This
development allows the integration of medical imaging (fluoroscopy, MRI, CT) into the ENvue System, enabling real-time navigation of
the feeding tube based on the patient’s anatomical information. In January 2022, ENvue completed the product development process,
and is planning to initiate a clinical trial to assess the ENvue System’s capability to perform internal tube navigation based
on a chest X-ray image.

Peripherally
Inserted Central Catheter (PICC)

This
is a procedure for inserting a catheter into central blood vessels to ensure the catheter’s proper placement in the patient’s
blood vessels using the electromagnetic navigation technology of the ENvue System. This development is expected to allow ENvue System
users to perform PICC insertion with electromagnetic navigation on X-ray images, with real-time alerts from the ENvue System about incorrect
catheter placement in the patient’s body. Inserting a catheter into central blood vessels is essential for administering medications,
fluids, and nutrition and for taking continuous blood samples from hospitalized patients.

ENfit
Compatible Syringes

In
January 2026, ENvue announced the launch of ENfit compatible syringes designed for use with the ENvue System and enteral feeding tube
placements. ENfit is the internationally recognized connector standard (ISO 80369-3) developed to reduce the risk of misconnections between
enteral feeding devices and non-enteral lines. The ENfit compatible syringes are designed to work seamlessly with ENfit-compliant enteral
feeding tubes and connectors, supporting safe and accurate delivery of nutrition, hydration, and medications to patients requiring enteral
access. The Company believes the introduction of ENfit compatible syringes represents a meaningful expansion of its product portfolio
and supports its broader commercial strategy of providing a comprehensive enteral feeding solution to acute care hospitals in the United
States. In January 2026, ENvue signed a distribution agreement with U-Deliver, a U.S. based supplier of enteral feeding supplies, to
distribute ENvue’s ENFit compatible syringes through non-acute care channels nationwide. The syringes are available over the counter
in four sizes (2.5 mL, 5 mL, 10 mL, and 60 mL), meet ISO 80369-3 global standards, and are designed for reuse for up to seven days or
20 uses. Distribution is through U-Deliver’s website, Amazon storefront, and wholesale channels, targeting home care and long-term
care patients and caregivers. The agreement represents ENvue’s first commercial step into non-acute care channels, complementing
its existing acute care hospital business.

Robotic
Arm (ENvue Drive)

During
the year, the Company initiated development of a next-generation robotic platform within its ENvue Medical division, referred to as ENvue
Drive™, intended to automate aspects of electromagnetic navigation for enteral and vascular access procedures at the bedside.
The platform is being designed to integrate with the Company’s existing electromagnetic guidance technology used for enteral feeding
tube placement and is intended to support clinician alignment and positional stability during procedures. The system is currently in
the preclinical development phase and has not been submitted to the U.S. Food and Drug Administration (FDA) for regulatory clearance.
Development timelines and commercialization remain subject to engineering progress and applicable regulatory approvals.

Research
and Development

From
its founding, ENvue has engaged in the research and development of the ENvue System it developed—a system based on electromagnetic
navigation technology for inserting a feeding tube. In February 2019, ENvue received FDA clearance for the commercial marketing of the
product in the U.S. for adults (aged 22 and above) only.

ENvue’s
research and development activities have been focused mainly on product development and improvements and upgrades to various components
that make up the ENvue System to develop and improve performance.

10

II.
Clinical
Trials

As
part of the FDA clearance process for the system under the 510(k) pathway, ENvue was required to conduct a clinical trial following the
safety alert issued by the FDA regarding the use of the Cortrak*2 Enteral Access System, which is another device that, like the ENvue
System, is intended to facilitate enteral feeding tube placement, but was recalled due to serious adverse events resulting from misplaced
tubes in connection with the use of the system. During the clinical trial conducted by ENvue2, 58 feeding tube insertions
were performed on 57 subjects using the system, during which no feeding tubes were ultimately placed into the patient’s lung, and
no harm was caused to the patient’s lung during the procedure. In two cases, immediate correction of the tube insertion was performed
following the system’s alert of entry into the airways. Additionally, ENvue believes the trial results indicated ease of use of
the system and quick learning of how to operate it.

ENvue
Customers

ENvue’s
current and potential customers are hospitals in the U.S. As of 2023, there are approximately 5,222 hospitals in the U.S. that operate
intensive care units, which constitute the majority of ENvue’s potential customers (Fast Facts on U.S. Hospitals, 2024. American
Hospital Association. https://www.aha.org/statistics/fast-facts-us-hospitals). The primary users of ENvue’s products in these locations
are medical staff, usually nurses and clinical dietitians. As of the date hereof, ENvue’s customers include both hospitals in the
U.S. with which ENvue has signed direct sales agreements and hospitals within the hospital network with which ENvue has contracted under
the agreement detailed below.

ENvue
is in the stage of commercializing its products, and its sales activities in the U.S. were conducted directly with end customers. As
part of ENvue’s strategy to introduce the ENvue System into the U.S. market and expand its marketing efforts, ENvue may, in the
future, consider partnering with a distributor or strategic marketer, in addition to direct sales to customers in the U.S.

In
general, at large hospitals in the U.S., centralized procurement departments are responsible for the proposal submission process, contracting,
and negotiations for the purchase of all capital equipment. These departments emphasize economical and efficient operations. Typically,
a hospital procurement department consists of a procurement manager overseeing a team of senior and junior buyers. The process of purchasing
medical systems usually begins with the establishment of a Value Analysis Committee in the hospital, typically composed of physicians,
nurses, procurement agents, professional liability experts, supply chain management, and administrators. The committee coordinates discussions
with suppliers, visits sites where the systems are operated, and consults with colleagues from other hospitals. The main factors considered
by the procurement committee include (a) the hospital’s requirements based on a five-year forecast of patient needs (investment
horizon may vary between hospitals); (b) life cycle cost – total ownership cost; (c) economic considerations of cost recovery (cost
versus revenue); (d) performance, technical specifications, and physical data of the system; (e) workflow – capabilities, staff,
and output; (f) service, spare parts, and maintenance; (g) medical staff recommendations (quality of care).

ENvue
is not dependent on a single customer. The 4 customers comprise 18.6% of ENvue’s revenue.

2
The clinical trial lasted about a year, during which the Company was required to obtain the consent of the patients or their family
members (depending on the patient’s medical condition) for participation in the trial.

Description
of Key Terms of Engagement with End Customers

ENvue’s
agreements with its customers for the supply of the single-use-only ENvue Medical Enteral Feeding Tubes (EFTs) based on purchase orders
placed by the customer according to their needs, under terms outlined below. It should be noted that ENvue’s EFT is specifically
designed for use with the ENvue System. Per the FDA clearance for the ENvue System, which includes ENvue’s EFT, the system cannot
be used without this tube.

Negotiations
with ENvue’s customers are usually conducted by ENvue’s sales agents, following meetings with hospital procurement officials
and a demonstration (Demo) of the system, as well as evaluation by the medical staff through a few procedures of feeding tube insertion
in patients. Based on ENvue’s experience so far, the time from the demo to the receipt of a purchase order (PO) can take up to
6 months.

11

Under
ENvue’s agreements with customers for the purchase of the ENvue System, ENvue commits to manufacture, assemble, and supply the
system components to the customer according to schedules agreed upon by both parties for each engagement. Generally, the system is delivered
to the customer within a few weeks, and the feeding tubes are supplied within approximately one week from the customer’s purchase
order.

In
general, the consideration paid by the customer for the purchase of the system and feeding tubes is determined through negotiation between
the parties and according to ENvue’s discretion. Payment for the supply of the system and feeding tubes is typically made within
30 days of delivery, according to the specific engagement terms. It should be noted that in some cases, ENvue may provide the system
to the customer in exchange for replacing a competitor’s product owned by the customer, without any financial consideration (except
for the payment the customer will be required to make for the purchase of feeding tubes specifically for the system). The replaced competitor’s
product is used by ENvue, among other things, for training sessions it conducts for its customers on using the ENvue System instead of
the competitor’s product, as well as for ENvue’s research and development purposes.

The
agreement typically includes warranty periods for the system and the consumable feeding tubes, for periods defined in the agreement (generally
two years for the system and 30 days for the feeding tubes), during which ENvue commits to provide repair or replacement services for
defective components (defects) related to components manufactured by ENvue, within a timeframe agreed upon by the parties and according
to other terms set forth in the agreement. During the warranty period, ENvue may provide the customer with any necessary software and/or
hardware updates for the system, if any is needed for use of the system. In general, ENvue does not have a refund policy for its products
in most agreements.

Additionally,
the terms of engagement with the customer include standard cancellation clauses in appropriate circumstances (such as a material breach
of the agreement, company insolvency, etc.).

As
mentioned, customers who have purchased the ENvue System place ad-hoc orders with ENvue for the purchase of consumable feeding tubes,
according to the engagement terms outlined above. Customers issue a purchase order to ENvue, and in response, ENvue ships the products,
typically within a week. These orders are made according to the customer’s needs and generally on a monthly basis, with the consideration
determined by the price of the feeding tube agreed upon by the parties within the agreement.

EnVue
Sales and Marketing

ENvue
is continuously working to build awareness of its products among hospitals and the U.S. medical community in several ways, the main ones
being detailed below:

●
Conducting
Demonstrations for Potential Customers: As part of ENvue’s marketing activities, ENvue’s sales agents periodically
meet with hospital procurement officials, demonstrate (Demo) the system, and allow the medical staff to experience the system through
several procedures of feeding tube insertion in patients.

●
Engagements
with Group Purchasing Organizations (GPOs): A GPO is an entity that helps healthcare providers, such as hospitals, nursing
homes, and home health agencies, achieve savings and efficiency by aggregating purchasing volume and leveraging that to negotiate
discounts with manufacturers, distributors, and suppliers. ENvue believes that if it enters into agreements with such organizations,
it will allow for broader market penetration in relatively short timeframes.

●
Website
and Social Media: ENvue’s website provides information about ENvue and ways to contact it. Additionally, ENvue operates
several social media accounts, which include details about ENvue and its products, regular updates related to ENvue’s field
of activity, and the medical device market.

●
Press
Releases and Public Relations: ENvue publishes press releases related to agreements it has signed, new system deployments,
regulatory approvals received, and relevant milestones, such as significant capital and debt raisings. The announcements published
so far have generated media interest and have been covered in commercial media, national media, and technology publications.

●
Participation
in Events and Conferences: ENvue participates in selected events in the healthcare and technology industries to meet with
influencers and decision-makers in the field.

12

ENvue
believes it is not dependent on any of its marketing channels.

ENvue
Market Opportunity and Trends

I.
Use
of Enteral Nutrition Means

ENvue
operates in the market for enteral feeding devices for hospitalized patients needing nutritional support. The importance and use of enteral
nutrition means have been increasing over the last decade, partly due to their many advantages compared to traditional nutrition methods
in the market, such as parenteral nutrition (intravenous nutrition). Currently, enteral nutrition methods are widely used in many countries
worldwide. As of 2023, most enteral nutrition use was in North America (32.0%), Europe (29.0%), and Asia (24.0%) (“Enteral Feeding
Formulas Markt Size, Share, and Trends 2025 to 2034”; available at: https://www.precedenceresearch.com/enteral-feeding-formulas-market).

The
global enteral feeding devices market size was valued at $4.62 billion in 2025 (Enteral Feeding Devices Market Trends; Grand View
Research; available at: https://www.grandviewresearch.com/industry-analysis/enteral-feeding-devices-industry “Grand View Research”).
It is estimated that the market will grow at an annual rate (CAGR) (hereinafter: the “Growth Rate”) of approximately 5.86%
(about 4.4% in the USA) from 2024 to 2030, with the total market value expected to reach approximately $7.19 billion by 2030 (Grand View
Research).

Several
factors may drive the growth of the enteral nutrition market from 2024 to 2030, including rising healthcare costs, the increase in preterm
births, aging populations, the growing prevalence of chronic diseases such as diabetes, cancer, gastrointestinal diseases, and neurological
disorders, the increasing awareness of tube feeding, and improvements in healthcare systems in developing countries, among others.

However,
various factors, such as health risks, an increase in the number of malfunctions during patient feeding, and complications related to
tube feeding (such as faulty connections, tube disconnections, and infections), may limit the market’s growth. Additionally, incomplete
or no insurance coverage for using these means in countries where it is required (mainly developing countries), as well as a lack of
skilled medical personnel, are challenges to market growth.

Furthermore,
the rapid spread of the COVID-19 virus worldwide, especially the increase in morbidity in the USA, heightened the need to improve patient
nutrition, leading to increased demand for nasal enteral feeding means.

13

In
2023, hospitals were the primary users of enteral nutrition means (approximately 58.3% of global usage) (Grand View Research). The reasons
for this include the technological advancements of existing tube feeding methods, alongside the shift from intravenous nutrition to tube
feeding, which supports the growing use of these means in hospitals.

The
adult age group segment dominated the market with a revenue share of 91.3% in 2023 (Grand View Research). Projections indicate that in
the USA, this population is expected to remain the primary group using enteral nutrition means, with an expected growth rate of approximately
6.7% from 2020 to 2025 and a market value of approximately $3.9 billion by 2025.

II.
The
Use of Enteral Feeding Tubes

Among
all enteral feeding methods, the market value of feeding tubes is the most dominant (approximately 45% in 2020). The use of enteral feeding
tubes includes, among other things, the insertion of an enteral feeding tube through the nose or mouth, as can be done using ENvue System.
It should be noted that most feeding tubes inserted through the mouth are intended for children and preterm infants. The ENvue System
is only cleared for use in adults, but ENvue believes that such clearance could potentially be expanded to include children and preterm
infants if ENvue is able to initiate and complete appropriately designed clinical studies that meet the endpoints necessary to demonstrate
that the system and its EFTs can be safely and effectively used in children and preterm infants and obtain the requisite FDA clearance
for such use.

According
to studies, approximately 43 million feeding tubes are inserted annually worldwide (Markets & Markets) through the nose, primarily
in North America (approximately 35%), Europe (approximately 28%), and Asia (approximately 24%), with an expected annual growth rate of
approximately 5.5%, 5.9%, and 9.1%, respectively, between 2020-2025.

Public
Awareness

In
recent years, there has been a growing trend in public awareness in Western countries, including the USA, regarding the importance of
using aids to ensure the proper insertion of feeding tubes into patients. This is mainly due to the increased awareness of the risks
associated with current insertion methods, such as patient lung injury, which can lead to lung collapse and even death. ENvue estimates
that this trend may increase the demand for its product in these countries due to its importance in minimizing the risks associated with
feeding tube insertion.

Awareness
in the Medical Community

The
medical community’s awareness of performing the feeding tube insertion procedure using ENvue’s product and the medical community’s
adoption of the solution offered by ENvue, instead of other methods and products in the market for performing the procedure, is significant
and crucial for ENvue’s success. Therefore, ENvue works with medical professionals in the USA to raise awareness among the medical
community. Additionally, ENvue works to raise awareness in this market, including through appearances at medical conferences, exhibitions,
participation, and conducting clinical studies for marketing purposes, as well as using various digital means.

Another
development in the general environment in which ENvue operates is the increasing use of the internet by medical professionals to obtain
information on new technologies and alternatives to existing methods for performing various medical procedures. Accordingly, ENvue works
to deepen public awareness and awareness among the medical community of the use of ENvue’s product as an alternative to existing
methods.

Medical
studies published in recent years regarding the risks associated with the use of existing methods for feeding tube insertion (mainly
the “blind” insertion method), as well as future studies on the subject, if published, may increase or decrease the demand
for ENvue’s product in the field in which it operates.

In
this context, it should be noted that the Patient Safety Movement organization6 published an article regarding the complications
and risks associated with the insertion of feeding tubes into patients, including ways to cope, guidelines, and recommendations for implementation
by hospital staff. The article emphasized the importance of proper feeding tube insertion in patients and identifying incorrect tube
insertion to ensure patient safety and the quality of medical care provided in the hospital, while reducing risks and preventing preventable
damage. The article outlines, among other things, guidelines, and actions to be taken by hospital medical staff to ensure proper placement
of feeding tubes in the patient’s body, including the limitations and risks associated with existing methods and technologies.

6

The Patient Safety Movement Organization is an American organization consisting of medical professionals from around the world, with the goal of preventing deaths caused by errors during hospital treatments.

See the link: https://patientsafetymovement.org/clinical/enteral-tube-safety/enteral-tube-safety-nasogastric-tube-ngt-placement-and-verification
And also: https://patientsafetyj.com/index.php/patientsaf/article/view/misplaced-nasogastric-tubes

14

III.
Entry
Barries to the Target Market

ENvue
estimates that there are significant entry barriers to the target market in which it operates. The main barriers to entry in ENvue’s
field of activity are as follows:

●
Scientifically
and Clinically Proven Technological Development - Pre-clinical and clinical work, which are usually essential conditions
for marketing a medical product, as well as the ability to ensure that a product that appears promising from a technological perspective
proves successful in the medical community, involve uncertainty, and create an entry barrier for competitors.

●
Regulatory
Constraints - The development, production, and sale of medical devices in the field typically require obtaining regulatory
approvals and meeting various standards depending on the country where the relevant activity is conducted, including approvals required
for conducting clinical trials in humans. A company that seeks to sell its products in a country where it does not have approval
for sale will often be required to invest significant resources, both time and money, to obtain the approval and the preliminary
processes. A company that is seeking to obtain similar regulatory approval or clearance to ENvue’s products or product candidates,
will need to meet the same or similar requirements and conditions that ENvue was required to meet, which may include conducting a
clinical trial, as ENvue was required to do to obtain FDA clearance under the 510(k) pathway for the commercial marketing of the
ENvue System in the U.S.

●
Intellectual
Property Protection - Products in the field are based on original technologies protected by patents or other intellectual
property rights in various countries. Intellectual property protections may prevent similar products from being marketed in relevant
countries for an extended period, potentially even decades.

●
Initial
Capital and Knowledge - The development of products or processes in the field requires significant initial capital, appropriate
knowledge, and expertise. A product development project like ENvue’s products takes several years and requires extensive clinical,
biological, physiological, and chemical knowledge. A lack of funding or the required knowledge and expertise to conduct the research
and development could lead to the failure of the product’s development.

●
Skilled
Workforce - Developing, licensing, and producing products in the field requires professional and skilled personnel. A company
entering the field must recruit suitable personnel, and it may struggle to do so due to a lack of sufficient skilled and professional
workers.

●
Technological
Risk - Entering the field involves the risk that after significant investment of money and time, the developing company may
fail in developing the products, producing them, or obtaining the necessary approvals. Additionally, there is a risk that during
or after the completion of the development and licensing processes, it may become apparent that a competitor of the developing company
has developed a superior technology, giving them a competitive advantage.

●
Marketing,
Distribution, and Sales Capabilities - Companies operating in ENvue’s field of activity are required to establish,
finance, and maintain a sales and marketing infrastructure, whether through an internal team or by engaging with external distributors.
Each of the above options requires special and individual resources and connections in the field of activity, which constitutes a
barrier to entry for competitors. Additionally, there is a need for suitable marketing and distribution channels to handle institutional
bodies such as hospitals, which can compete against large companies operating in the field of ENvue’s products.

●
Rate
of Market Penetration - Penetrating the target market in the field of activity requires a long time, partly due to the entry
barriers described above.

https://patientsafetymovement.org/clinical/enteral-tube-safety/enteral-tube-safety-nasogastric-tube-ngt-placement-and-verification
And also: https://patientsafetyj.com/index.php/patientsaf/article/view/misplaced-nasogastric-tubes

Competition
for ENvue System

ENvue
industry is competitive and has been evolving rapidly with the introduction of new products and technologies as well as the market activities
of industry participants. The ENvue System is indicated for use in adults 22 and over years of age to aid qualified operators in the
placement of the ENvue Medical Enteral Feeding Tube of 8 Fr, 10 Fr, and 12 Fr into the stomach or small intestine of adult patients requiring
enteral feeding. ENvue competes against other companies that have developed similar devices in the market for enteral feeding devices
for hospitalized patients needing nutritional support.

15

In
order to address the potential risks and complications associated with the “blind” insertion method of feeding tubes and
the drawbacks of standard methods for verifying the placement of the feeding tube, several products have been developed over the years
using technological tools to enable real-time monitoring of the feeding tube’s placement within the patient’s body. Based
on ENvue’s knowledge of the current landscape, there are two technological products on the market intended for use(s) similar to
that of the ENvue System: “IRIS Kangaroo Feeding Tube” (“IRIS Kangaroo”) and “Cortrak 2 Enteral Access
System” device (“Cortrak”). In addition, there are companies at various stages of developing feeding tubes with different
insertion methods that do not rely on intrabody navigation, and as of the date of this filing, ENvue does not consider them part
of its main competitors in the field of activity.

ENvue
System

IRIS
Kangaroo Feeding Tube

Cortrak
2 Enteral Access System

ENvue

Cardinal
Health

Avanos
Medical3

Product
Features and Usage

A
navigation system based on electromagnetic technology used to assist in the efficient, safe, and quick insertion of a dedicated feeding
tube into patients, with real-time tracking of the tube’s insertion path and immediate alerts for incorrect insertion paths.

A feeding tube platform incorporating camera-based visualization technology
intended to assist with tube advancement and placement The product has been in use since 2014.

A
feeding tube with an electromagnetic component installed at the end, which emits electromagnetic
waves to a device placed on the patient, located in the Xiphoid Process area. This device
receives the waves and displays the tube’s position on a monitor. The product has been
in use for approximately 20 years.

3
To the best of ENvue’s knowledge, Avanos Medical acquired the product in 2016.

Market share data for products in this category is
not publicly available to our knowledge, and we therefore cannot reliably estimate comparative market share.

Competitive Considerations

IRIS Kangaroo utilizes camera-based visualization. As with any imaging-based
system, performance may depend on factors such as image quality, field of view, patient conditions, operator training, and workflow integration.
Certain customers may prefer alternative technologies depending on their staffing models, procedural preferences, and institutional requirements.

The
second product, Cortrak, is based on electromagnetic technology. This device displays the feeding tube insertion path in real-time
and allows the operator to navigate the tube into the digestive system. Preliminary studies have shown that inserting a feeding tube
in this way may reduce the need for X-rays (Hemington-Gorse, S. J., et al. “The use of the Cortrak Enteral Access
System™ for post-pyloric (PP) feeding tube placement in a Burns Intensive Care Unit.” Burns 37.2 (2011): 277-280;
Koopmann 2011). Customer preferences may vary based on installed base, familiarity, training pathways, clinical protocols,
purchasing agreements, and institutional experience. To the best of ENvue’s knowledge, the ENvue System is technologically
distinct from the Cortrak device in several respects, including: (1) performing a registration to the patient’s body that
allows for the display of the patient-specific chest contour according to individual dimensions on the system screen; (2) providing
a graphical and textual alert for feeding tube entry into the patient’s airway; (3) using the patient’s anatomical
landmarks for the navigation process; (4) additional sensors that enable accurate insertion of the feeding tube even if the patient
moves (without the need to place a device on the patient’s body); (5) a sensor embedded within the feeding tube; (6) three
simultaneous vies; and (7) responsive real time display of the tube tip pathway (40 image per second refresh rate) and more. The relevance of any particular feature may vary by customer, use environment, and clinical practice.

Regulatory and Market Events Involving Competing
Products

The competitive environment may be influenced by regulatory
actions, safety communications, recalls, published studies, professional guidance, and evolving standards of care affecting products in
our market.

In January 2018, the U.S. Food and Drug Administration
(“FDA”) issued a letter to healthcare providers regarding feeding tube placement systems following reports of cases in which
feeding tubes were placed into the lungs despite device indications of gastric placement. Among other things, the FDA stated that device
output should not be relied upon as the sole method of confirming feeding tube position. The communication did not prohibit the sale or
use of the affected product. Public safety communications of this nature may affect customer perceptions, purchasing criteria, training
requirements, and market adoption dynamics.4

In March 2022, Avanos Medical issued
field correction notices relating to the CORTRAK 2 Enteral Access System. On May 13, 2022, the FDA classified that action as a Class
I recall, the most serious type of recall classification, noting that incorrect placement of nasogastric or nasoenteric tubes could lead
to serious injury or death. We cannot predict the extent to which any such event involving a competing product may benefit us, harm us,
or have no material effect on our business. Competing products may remain available and continue to be used notwithstanding such events.5

4 U.S.
Food and Drugs Administration: Feeding Tube Placement Systems: Letter to Health Care Providers (January 2018), available at: https://www.fda.gov/medical-devices/letters-health-care-providers/feeding-tube-placement-systems-letter-health-care-providers

5 U.S.
Food and Drug Administration, Medical Device Recall Database, CORTRAK 2 Enteral Access System, Class I Recall Classification posted May
13, 2022, available at:https://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfres/res.cfm?id=193098

16

Additionally,
on March 21, 2022, Avanos Medical initiated a voluntary recall of the Cortrak device, issuing a field correction notice to customers.
The FDA subsequently classified the recall as Class I — the most serious type of recall — on May 13, 2022, noting that incorrect
placement of nasogastric or nasoenteric tubes using the device could lead to serious injury or death.

Pricing and Economic Competition

Traditional blind-placement methods may involve lower
direct product costs than technology-assisted placement systems. However, customers evaluate products using a range of factors beyond
unit price, including workflow efficiency, staffing requirements, training burden, confirmation procedures, clinical confidence, patient
safety considerations, total cost of care, and institutional protocols.

Competing technology-assisted systems may be priced
similarly to, above, or below our offerings depending on configuration, purchasing volume, contracting arrangements, and geography. Pricing
pressure, bundled purchasing strategies, group purchasing contracts, distributor leverage, and competitor discounting could adversely
affect our ability to grow revenue or maintain margins.

ENvue’s
Main Strategies for Dealing with Competition

EnVue
has historically dealt with competition in its market by differentiating and developing the technology of its products, developing a
training model for customers, investing in the deployment of a service sales network, and an effective marketing strategy. Additionally,
EnVue worked to protect its intellectual property by registering its intellectual property rights in countries where it identifies potential
activities, in order to maintain the competitive advantage of its products in the field of activity.

EnVue
estimates that the ENvue System it developed provides it with a competitive advantage over other products available in the market, as
well as the quality of the products and services it provides, and its intellectual property protected by patents. The factors strengthening
ENvue’s competitive position are described in further detail below:

(1)
Technological
Capability and Unique Operating Method of ENvue’s Product: The ENvue System has an advantage over competing products by
providing a stable real-time image of the patient’s body, regardless of patient and/or device movements. It also does not require
special expertise and can be operated by a trained care provider. These advantages pose a challenge for competitors who struggle
to achieve the same level of reliability and stability in products and services in the field of activity, including the unique and
effective electromagnetic navigation method, which is partly patented.

(2)
Significant
Technological Improvement Compared to Existing Methods: We believe our platform addresses important customer needs relating to
bedside workflow, procedural efficiency, and confidence during placement procedures. Actual outcomes may vary by institution, operator
training, patient population, and clinical practice.

(3)
Skilled
and Experienced Workforce: Our personnel bring experience across engineering, operations, commercialization,
regulatory affairs, and customer support. We believe this cross-functional capability supports continued growth and execution.

(4)

Intellectual
Property: We maintain patents, trademarks, know-how, and other proprietary rights
in multiple jurisdictions. We believe our intellectual property portfolio supports our competitive positioning, although there can be
no assurance that such protections will prevent competition or provide a material commercial advantage.

Nano
OpCo’s Business

Nano
OpCo’s primary products, which are in various stages of clinical and market development, currently consist of:

●

PainShield,
a patch based therapeutic ultrasound technology designed to treat pain, muscle spasms and
joint contractures by delivering localized ultrasound energy that promotes pain relief and
supports soft tissue healing in targeted areas, including PainShield MD, a single use patch-based
device utilizing this technology.

●
UroShield,
an ultrasound-based product that is designed to prevent bacterial colonization and biofilm in urinary catheters, increase antibiotic
efficacy and decrease pain and discomfort associated with urinary catheter use. It is currently being marketed in Europe under a
CE mark.

17

Each
of PainShield and UroShield employs a small disposable transducer that transmits low frequency, low intensity ultrasound acoustic waves
designed to support tissue repair and regeneration of musculoskeletal and vascular structures. The technology is also intended to decrease
biofilm formation, reduce catheter blockage, and alleviate pain associated with urinary catheters, while potentially reducing the incidence
of catheter associated urinary tract infections.

Through
their size, effectiveness and ease of use, these products are intended to eliminate the need for technicians and medical personnel to
manually administer ultrasound treatment using large transducers, thereby promoting patient independence and enabling more cost effective
home based care.

PainShield
MD is currently cleared for marketing in the United States by the FDA. Both PainShield and UroShield have CE Mark approval in the European
Union and hold regulatory certification permitting commercial sale in Israel.

In
the United States, PainShield and UroShield require a prescription from a licensed healthcare practitioner.

Insurance
Coverage and Reimbursement

In
addition to the need to obtain regulatory approvals, we anticipate that sales volumes and prices of NanoVibronix’s UroShield and
PainShield, products will depend in large part on the availability of insurance coverage and reimbursement from third party payers. Third
party payers include governmental programs such as Medicare and Medicaid and the Veterans Health Care network of facilities in the United
States, private insurance plans and workers’ compensation plans. Effective as of January 2020, the U.S. Centers for Medicare and
Medicaid Services (“CMS”) approved our PainShield for reimbursement for Medicare beneficiaries on a national basis. However,
PainShield was not assigned a reimbursement value from CMS. The Company was denied reimbursement in September 2022 due to a lack of “life-cycle”
testing. We are currently evaluating whether to resubmit another application to CMS.

With
respect to UroShield, which may be used in a clinical and home setting, we currently have reimbursement in the United Kingdom - The NHS
Drug Tariff Part IX establishes a direct, prescription-based reimbursement pathway, for the UroShield® Kit (November 2025), which
is used in conjunction with the UroShield® Actuator that was previously included in the NHS Drug Tariff Part IX in the UK in 2023, and throughout the VA system. We are seeking reimbursement codes for use of our products in the markets in which we have regulatory
authority, including the United States, to sell such products. Our current ongoing research and planned research may facilitate our ability
to obtain reimbursement codes, but there is no guarantee that we will be successful in obtaining such codes quickly, or at all.

Nano
OpCo’s Business Model

All
of Nano OpCo’s products consist of a reusable controller device and a disposable component, which includes a transducer, and in
the case of PainShield, a 30-day supply of adhering patches. The components are purchased by either the distributor or end user for
use in any of the intended applications. Once the controller is purchased by the end user, recurring revenue will be realized by purchases
of replacement disposables to the extent that the end user continues treatment with our product.

Nano
OpCo’s products are intended to be distributed directly by either the dedicated sales force, independent distributors, and potential
licensees. Distributor cost is discounted to account for their intended margins, based upon purchase volumes and/or periodic purchase
commitments, with the disposable transducer sold and distributed in the same fashion. We currently have an established distributor network
and are implementing certain criteria within such network to ensure the appropriate assignment of a distributor or licensee.

Nano
OpCo’s business plan continues to focus on these types of transactions/agreements. We continue to focus on the foundational aspects
of each respective product, including the design and performance of each, the reimbursement, regulatory status, and quality control,
in order to strengthen our position with prospective partners.

Ultrasound
Technology and Nano OpCo’s Products

As
noted above, Nano OpCo’s primary products are based on the use of low frequency ultrasound, which delivers energy through mechanical
vibrations in the form of sound waves. Ultrasound has long been used in physical therapy, physical medicine, rehabilitation and sports
medicine.

18

Our
proprietary PainShield technology consists of a small, thin (1 millimeter) transducer that is capable of transmitting ultrasonic acoustic
waves onto treatment surfaces with a radius of up to 10 centimeters beyond the transducer. This technology allows us to treat pain by
securing our transducers to the skin with a separate adhesive patch, thereby eliminating the need for technicians and medical personnel
to manually administer ultrasound therapy, which should reduce the cost of therapy. Moreover, we believe that, based upon the body of
evidence, the delivery of ultrasound through our portable devices may provide a competitive advantage over other existing therapies marketed
for similar intended use(s) (e.g., to treat pain associated with muscle, tendon, and contractures), as our technology is positioned to
directly target the affected areas of the body within the scope of the applicable FDA clearance.

While
there are currently a number of products on the market that treat pain through ultrasound therapy, we believe that our products may be
preferable in certain instances because they are portable, without the requirement to be plugged into an outlet and they have a frequency
of 100kHz (in contrast to other devices, which have a frequency of closer to 1MHz and above), which means our products, when functioning
as intended and in accordance with applicable design specifications, should not produce excessive heat that can damage tissue. Therefore,
our products (i) can be self-administered by the patient without the need to be moved about the treated area by the patient or a clinician,
(ii) can be applied for a significantly longer period without the risk of tissue damage and (iii) do not require the use of gel. We are
also aware of one product, the SAM® Sport family of products, which received FDA approval after PainShield and has CE Mark approval,
marketed by ZetrOZ, Inc., that we understand may eliminate certain of these requirements and limitations, namely the requirement to be
plugged in, the need for movement around the treated area and the relatively short safe treatment period. However, we understand that
this product does not generate surface acoustic waves as our products do, which means that the treatment area is generally limited to
that under the transducer, that the use of transmission gel is still required, and that the transducer thickness is significantly greater
than ours (approximately 1.5 cm). It is also our understanding that the FDA has issued multiple contraindications for SAM® Sport,
which do not apply to the PainShield product.

There
has been an article published in 2019 on SAM® Sport4 regarding clinical evidence demonstrating that ultrasound dose timing (i.e.
daily treatment) and duration significantly impact benefits and treatment results. We are aware of a prospective randomized, double-blinded,
placebo-controlled study on the effects of the long-duration low-intensity ultrasound treatment using SAM® Sport4 suggesting that
ultrasound may be used as a conservative non-pharmaceutical and non-invasive treatment option for patients with knee osteoarthritis.

In
general, ultrasound offers the benefits by increasing local blood circulation, increasing vascular wall permeability, promoting protein
secretion, promoting enzymatic reactions, accelerating nitric oxide production, promoting angiogenesis (the formation of new blood vessels
from pre-existing vessels) and promoting fibroblast proliferation (fibroblasts are a type of cell that play a critical role in soft tissue
healing). We believe that the body of evidence, and the positive therapeutic effect that ultrasound has for various indications, potentially
provides for future product development opportunities for us.

Conventional
Ultrasound
PainShield
Ultrasound

Traditional
ultrasound device and our portable ultrasound patch-based device and a comparison of their energy distribution, where the X-axis represents
treatment surface, and the Y-axis represents ultrasound energy penetration depth within tissue.

In
a comparison of a traditional ultrasound device and our portable ultrasound patch-based device, the bulk wave conventional ultrasound
machines with handheld transducers distribute the energy deeply into the body, as shown above in diagram (A) on the left. In comparison,
our device distributes the energy on the surface, as shown in diagram (B), thereby meaningfully increasing the treatment area. Our transducers
may also be incorporated into treatment patches, including patches that are designed to deliver medicine and other compounds through
the skin. The generation and delivery of low frequency ultrasound over a period of time to a specific area has been termed “targeted
slow-release ultrasound”. We believe that this delivery method of ultrasound may be comparable to that of slow-release medication
in the pharmaceutical industry. This “targeted slow-release” capability is intended to allow for more frequent targeting
of the intended treatment area and thus may result in a more effective therapeutic response.

19

Micro
Vibrations Technology and Nano OpCo’s Products

In
a 2007 study, increase in mean blood flow to the calf was higher in the vibration group than the placebo group. Improvements in local
blood flow may be beneficial in the therapeutic alleviation of pain or other symptoms resulting from acute or chronic injuries (C. Button
et al., “The effect of multidirectional mechanical vibration on peripheral circulation of humans”, University of Otago New
Zealand, Clinical Physiology and functional Imaging, 2007 27, p211-216). A study on the effect of whole body vibration on lower extremity
skin blood flow suggests, that short duration vibration alone significantly increases lower extremity skin blood flow, doubling skin
blood flow for a minimum of 10 minutes following treatment (Lohman et al., “The effect of whole body vibration on lower extremity
skin blood flow in normal subjects”, Department of Physical Therapy, Loma Linda university, USA, Med Sci Monit, 2007; 13(2) 71-76).
Vibration has also been shown to stimulate angiogenesis and growth factors such as vascular endothelial growth factor (Suhr F et al.,
“Effects of short-term vibration and hypoxia during high intensity cycling exercise on circulating level of angiogenic regulators
in humans”, J Appl Physiol, 2007, 103:474-483, Yue Z. et al., “On the cardiovascular effects of whole-body vibration I. Longitudinal
effects: hydrodynamic analysis”, Studies Appl Math, 2007, 119:95-109).

Relative
to soft tissue repair, it is well established that increasing blood flow to the wound and peri-wound area helps accelerate the healing
of ischemic wounds. Micro-vibrations applied on the skin tissue increase local blood flow and oxygen delivery to the wound area and stimulate
angiogenesis and growth factors that are helpful for the wound healing process. Vibration therapy has been found to stimulate blood flow
due to mechanical stresses of endothelial cells resulting in increased production of nitric oxide and vasodilation, as well as increase
soft tissue and skin circulation. (Maloney-Hinds et al., “The Role of Nitric Oxide in Skin Blood Flow Increases due to vibration
in healthy adults and adults with type 2 diabetes,” School of Medicine, Loma Linda University. Ca. Diabetes Technology & Therapeutics,
2009 p. 39-43). In addition, micro vibrations induce skin surface nerve axon reflex and type IIa muscle fibers contraction rates, resulting
in vasodilation (Nakagami et al., “Effect of vibration on skin blood flow in an in vivo microcirculatory model”, The University
of Tokyo, Bio-Science Trends 2007; 1 (3): 161-166). Ten minutes of vibration therapy with laser doppler revealed a consistent increase
in water content of the upper dermis (TJ Ryan et al., “The effect of mechanical forces (vibration or external compression) on the
dermal water content of the upper dermis and epidermis, assessed by high frequency ultrasound”, Oxford Wound Healing Institute,
Journal of Tissue Viability, 2001. Of import with respect to diabetic wounds, in which a prolonged inflammatory phase occurs, vibration
vasodilation has generated an indirect anti-inflammatory action, mainly by suppression of nuclear factor-kβ, the key gene for inflammatory
mediators (Sackner, M.A., “Nitric Oxide is released into circulation with whole-body, periodic acceleration”, Chest 2005;127;30-39).

Urinary
catheter usage is associated with pain and discomfort caused by the friction between the catheter surface and the urethral tissue. Generally,
this friction is treated by applying lubricating gels and low friction catheter coatings. These methods are effective for a short term
during the catheter insertion as the lubricating gel is quickly absorbed into the surrounding tissue and loses its effect and the catheter
coatings lose their lubricity within a few days, as the coating is covered by a thin film of mucous.

Our
UroShield product provides vibrations along the surface of the urinary catheter that is in contact with urethral tissue. We believe that
these vibrations create a continuous acoustic lubrication effect along the surface of the indwelling catheter that is in contact with
the surrounding tissue, thus reducing catheter-tissue contact time, which may lessen trauma from urethra abrasion and adhesion. We have
also shown in animals and in humans that the micro-vibration technology can reduce the level of biofilm formation on urinary catheters.

Nano
OpCo’s Products

Product
Design, Packaging, Identity

We
currently complete assembly in our facilities in Israel and planning to move manufacturing to a Contract Manufacturer located in the
US. Even though our ability to assemble our products has not been affected by the current political environment, we cannot predict if
future events may cause delays. Our 2025 production run established an ample supply of devices and monthly disposable kits. The completed
products can be used as a platform for either PainShield or UroShield.

20

UroShield

UroShield
is intended to prevent bacterial colonization and biofilm formation, increase antibiotic efficacy in the catheter lumen and decrease
pain and discomfort associated with urinary catheter use. It is designed to be used with any type of indwelling urinary catheter regardless
of the material or coating. Use of the device is contraindicated for use while there is an active UTI. We believe that UroShield may
be the first medical device on the market that attempts to simultaneously address all of the aforementioned catheter-related issues.
UroShield is similar in design to PainShield, in that it uses a driver unit that produces low frequency, low intensity ultrasound. The
driver unit connects to a disposable transducer that is clipped onto the external portion of the catheter to deliver ultrasound therapy
to all catheter surfaces as well as the tissue surrounding the catheter.

Picture
of UroShield with actuator

Clinical
studies of the UroShield system have supported the following advantageous effects:

●
Prevention
or Reduction of Biofilm. The low frequency ultrasound generated by UroShield has been shown to decrease adherence of bacteria
to catheter surfaces, thereby reducing biofilm. Biofilm is the complex matrix required for bacteria to grow and cause infection.
See the discussion of our Heidelberg 1 trial below.

●
Decreased
Catheter Associated Pain and Discomfort. We believe that UroShield creates an acoustic envelope on the surfaces of the catheter,
which decreases friction and tissue trauma, pain and discomfort caused by the catheter. In addition, in vivo (rabbit) studies have
shown the tissue in contact with the catheter remains healthier and less traumatized as a result of the application of low frequency
and low intensity ultrasound (Applebaum I, et.al., “The Effect of Acoustic Energy Induced By UroShield on Foley Catheter Related
Trauma and Inflammation in a Rabbit Model” Department of Urology, Shaarey Zedek Medical Center and the Hadassah Hebrew University
Medical School).

●
Acoustically
Augmented Antibiotic Therapy. Antibiotic resistance in biofilm bacteria is a well-known phenomenon. Although it has been known
that ultrasound can increase antibiotic efficacy in in-vitro models, we do not believe that there has been a practical ultrasound-based
medical device that was able to augment antibiotic efficacy in the clinical setting. In a clinical study, UroShield technology has
been shown to eradicate biofilm-residing bacteria by greater than 85% when applied simultaneously with an antibiotic in three clinically
relevant species, escherichia coli, staphylococcus epidermidis and pseudomonas aeruginosa (Banin E, et al., “Surface acoustic
waves increase the susceptibility of Pseudomonas aeruginosa biofilms to antibiotic treatment,” Biofouling, August 2011; we
supplied devices for this study, but had no further involvement with it).

●
Preservation
of the Patency of Catheters. We believe that low frequency ultrasound applied to catheters will add an anti-clogging effect and
will preserve patency of catheters. This effect is achieved by ultrasound waves creating an acoustic layer on the inner lumen of
the urinary catheter, thereby preventing adherence of biological material and biofilm formation. We believe that this anti-clogging
benefit will help prevent local infection and sepsis secondary to catheter obstruction.

In
November 2025 the UroShield® Kit has been added to the UK National Health Service (NHS) Drug Tariff Part IX, enabling nationwide
prescription reimbursement across the UK.

The
NHS Drug Tariff Part IX establishes a direct, prescription-based reimbursement pathway, significantly expanding access for the UroShield®
Kit, which is used in conjunction with the UroShield® Actuator that was previously included in the NHS Drug Tariff Part IX in the
UK in 2023, across community and hospital care settings.

UroShield
will be available to all patients who need the device with full clinical support, through the NHS supply chain. It represents a significant
opportunity for us to expand distribution of UroShield as it will now be made available to all clinicians and their patients through
the NHS organization’s own supply channel. NHS Supply Chain manages the sourcing, delivery and supply of healthcare products and
services for NHS trusts and healthcare organizations across England and Wales. The organization processes more than eight million orders
per year across 94,000 order points and 17,465 locations serving as an integral part of the national healthcare system in the U.K.

21

1. Market
for UroShield

A
urinary tract infection (UTI) is defined by the Centers for Disease Control and Prevention (CDC) as an infection involving any part of
the urinary system, including the urethra, bladder, ureters, and kidney (CDC, 2024). UTIs remain the most common type of healthcare-associated
infection (HAI) reported to the National Healthcare Safety Network (NHSN), and catheter-associated UTI (CAUTI) continues to account for
the largest share of HAIs in both hospital and long-term care settings.

Among
UTIs acquired in hospital settings, approximately 75% are linked to an indwelling urinary catheter. An estimated 15–25% of hospitalized
patients will have an indwelling catheter at some point during their stay, and approximately 7% of nursing home residents are managed
via long-term catheterization (CDC, 2024).

2.
Current
Epidemiology (2023–2025)

Metric
Current
Data (2023–2025)

CAUTI
share of all HAIs
~26–30% of all
reported HAIs (NHSN 2023)

ICU
CAUTI rate
~0.9–1.4 per
1,000 catheter-days (NHSN 2023)

Non-ICU
CAUTI rate
~0.5–0.9 per
1,000 catheter-days (NHSN 2023)

Patients
with catheter during stay
15–25% of all
hospital admissions

Nursing
home catheter prevalence
~7% of residents (long-term
catheterization)

Daily
bacteriuria risk (catheterized)
3–10% per day;
~25% at 7 days

Bacteriuria
at >30 days catheterization
Virtually 100%

CAUTI-related
bacteremia (acute care)
~17–20% of healthcare-acquired
bacteremia

CAUTI-related
bacteremia (long-term care)
~50% of healthcare-acquired
bacteremia

3.
Pathophysiology

CAUTI
occurs because urethral catheters inoculate organisms into the bladder and promote colonization by providing a surface for biofilm formation
and causing mucosal irritation (Maki & Tambyah, 2001). The extraluminal route (migration of organisms along the catheter-meatus interface)
is responsible for the majority of early infections, while the intraluminal route becomes more significant with longer catheter dwell
time.

The
most common causative organisms identified in recent NHSN surveillance (2015–2022) include (Weiner-Lastinger et al., 2021):

●
Escherichia
coli (~21%)

●
Candida
spp. (~18–21%)

●
Klebsiella
pneumoniae (~11%)

●
Enterococcus
spp. (~10%)

●
Pseudomonas
aeruginosa (~8%)

Of
note, the proportion of antimicrobial-resistant pathogens causing CAUTI has risen, with ESBL-producing organisms and fluconazole-resistant
Candida species now representing a growing clinical challenge (Weiner-Lastinger et al., 2021).

22

4.
Economic and Healthcare Burden (Updated)

4.1
Cost per CAUTI Episode

The
economic burden of CAUTI has been re-evaluated in multiple recent analyses. The cost per CAUTI episode attributable to the catheter ranges
broadly depending on complexity, but current estimates are (AHRQ, 2023; Mitchell et al., 2023):

●
Simple
CAUTI (uncomplicated): $896–$2,836 per episode in attributable costs

●
CAUTI
with secondary bacteremia: $13,793–$32,000+ per episode, reflecting increased LOS and treatment costs

●
Total
annual US burden: estimated at $340 million to $450 million annually

4.2
Global Catheter Market (2025 Data)

The
global urinary catheter market was valued at approximately USD 4.5–5.2 billion in 2023 and is projected to reach USD 7.0–8.5
billion by 2030, growing at a CAGR of approximately 6.5–8.2% (Grand View Research, 2023-2024). This revision reflects updated segmentation
methodology separating urinary catheters from the broader catheter market reported in earlier analyses.

In
the United States, approximately 30 million urinary catheterization procedures occur annually (including both intermittent and indwelling),
with Foley catheter usage estimated at 20–25 million units per year. Global Foley catheter sales are estimated at 80–100
million units annually (Grand View Research, 2023-2024).

Key
growth drivers include the aging global population, rising prevalence of urological disorders and diabetes, expanded ambulatory surgical
procedures, and growing adoption of antimicrobial/anti-biofilm catheters.

5.
Current Prevention Guidelines (2023–2025)

The
most current CAUTI prevention guidance comes from a 2023 joint update by the Society for Healthcare Epidemiology of America (SHEA), the
Infectious Diseases Society of America (IDSA), and the Association for Professionals in Infection Control and Epidemiology (APIC) (Lo
et al., 2023). Key recommendations include:

5.1
Appropriate Catheter Use (Indication-Based)

●
Insert
catheters only for appropriate indications; avoid use for incontinence management alone.

●
Implement
real-time nursing-driven catheter removal protocols (“CAUTI bundles”).

●
Consider
alternatives: condom/external catheters for males, intermittent catheterization, and absorbent products.

5.2
Insertion and Maintenance

●
Maintain
a sterile, closed drainage system at all times.

●
Ensure
unobstructed urine flow; keep bag below bladder level.

●
Perform
hand hygiene before and after any catheter manipulation.

●
Routine
catheter replacement is NOT recommended on a fixed schedule; replace only if obstruction or contamination occurs.

5.3
Technology Interventions

●
Antimicrobial
catheters (silver-alloy or nitrofurazone-coated): recommended for short-term use in high-risk settings, though evidence for long-term
benefit is mixed (Lo et al., 2023).

●
Electronic
reminder and stop-order systems are strongly recommended as system-level interventions to reduce unnecessary catheter days (Lo et
al., 2023).

●
Novel
anti-biofilm coatings (e.g., hydrophilic polymer coatings, bacteriophage-based coatings) are in clinical trial phases as of 2024–2025.

23

6.
CMS / Reimbursement Policy (Current Status)

Since
October 1, 2008, the Centers for Medicare & Medicaid Services (CMS) has not reimbursed hospitals for the additional costs associated
with CAUTI when it was not present on admission (POA). CAUTI is classified as a Hospital-Acquired Condition (HAC) (CMS, 2025).

As
of 2025, additional enforcement mechanisms are active:

●
HAC
Reduction Program (HACRP): Hospitals in the worst-performing quartile for HAC rates (including CAUTI) receive a 1% reduction in Medicare
payments. This program has been in place since FY2015 and continues to be enforced annually (CMS, 2025).

●
Hospital
Value-Based Purchasing (HVBP): CAUTI rates are a scored domain, directly affecting hospital reimbursement rates (CMS, 2025).

●
CMS
Star Ratings: CAUTI rates factor into CMS Hospital Compare star ratings, creating reputational and referral-based financial incentives
beyond direct reimbursement.

Competition
for UroShield

Several
types of products have been introduced to address the growing problem of catheter-acquired infection and biofilm formation on catheter
surfaces. Manufacturers offer antibiotic-coated and antiseptic-impregnated catheters. In addition, manufacturers have produced silver-coated
catheters, which have been shown in small studies to delay bacteriuria for about two to four days. However, larger studies did not corroborate
this result; on the contrary, silver hydrogel was associated with overgrowth of gram positive bacteria in the urine (Riley DK, Classen
DC, “A large randomized clinical trial of a silver-impregnated urinary catheter: lack of efficacy and staphylococcal superinfection,”
Am. J. Med. 1995 April; 98(4):349-56).

UroShield
has been designed to be added to any type of catheter, including Foley catheters and silver-coated catheters, to improve a catheter’s
infection prevention performance. However, in the United States, we do not have the requisite regulatory authorization to market UroShield
for such use, as we have not yet obtained FDA clearance or approval for UroShield. UroShield is not intended to replace any existing
products or technologies, but instead is intended to assist these existing products or technologies in preventing catheter-acquired urinary
injury and catheter associated complications.

Regulatory
Strategy

UroShield
received CE Mark approval in September 2007 and was also approved for sale by the Israeli Ministry of Health in 2008. We have maintained
our CE mark approval until now and expect that to continue going forward.

In
the European Union, UroShield has been marketed for the prevention of CAUTI and biofilm formation, decreased pain and discomfort associated
with urinary catheters and increased antibiotic efficacy.

The
company is continuing to assess the route for FDA clearance/approval.

UroShield
Sales and Marketing

From
time to time, we have had interest from strategic companies in the catheter market to partner, license or acquire the UroShield technology.
These strategic partners are active in the urology market and may be interested in integrating UroShield as an accessory, into their
respective range of products. Discussions with these partners are ongoing. There has also been interest from other companies with various
invasive line applications.

PainShield

PainShield
is an ultrasound device, consisting of a reusable driver unit and a disposable patch, which contains our proprietary therapeutic transducer.
It delivers a localized ultrasound effect to treat pain and induce soft tissue healing in a targeted area, while keeping the level of
ultrasound energy at a safe and consistent level of 0.4 watts.

24

We
believe the existing ultrasound therapy devices being used for pain reduction are primarily large devices used exclusively by clinicians
in medical settings. PainShield is able to deliver ultrasound therapy without being located in a health care facility or clinic because
it is portable, due to it being lightweight and battery operated. Because it is patch based and easy to apply, PainShield does not require
medical personnel to apply ultrasound therapy to the patient. Some patient benefits reported in prior studies included ease of application
and use, relatively quick recovery time, high patient compliance, and potentially increased safety and efficacy over certain other devices
that rely on higher-frequency ultrasound (Adahan M, et al, “A Sound Solution to Tendonitis: Healing Tendon Tears With a Novel Low-Intensity,
Low-Frequency Surface Acoustic Ultrasound Patch,” American Academy of Physical Medicine and Rehabilitation Vol. 2, 685-687, July
2010). PainShield can be used by patients at home or work or in a clinical setting and can be used even while the patient is sleeping.
Its range of applications includes acute and chronic pain reduction and anti-inflammatory treatment.

Picture
of PainShield with Patch

In
the United States, PainShield is only cleared to treat pain, muscle spasms, and joint contractures associated with or caused by various
conditions or diseases. It has also been used to treat pelvic and abdominal pain. To date, to the best of our knowledge, the primary
treatment options for several of these conditions are pain medication and surgery. Several additional causes of pain, and the treatment
of that pain with the PainShield product, can be explored through clinical trials.

Market
for PainShield

Pain-related
complaints are one of the most common reasons patients seek treatment from physicians (Prince V, “Pain Management in Patients with
Substance-Use Disorders,” Pain Management, PSAP-VII, Chronic Illnesses). According to Landro L, “New Ways to Treat Pain:
Tricking the Brain, Blocking the Nerves in Patients When all Else Has Failed,” Wall Street Journal, May 11, 2010, approximately
26% of adult Americans, or approximately 76.5 million people, suffer from chronic pain. The National Center for Health Statistics has
estimated that approximately 54% of the adult population experiences musculoskeletal pain. Studies have shown that low-frequency ultrasound
treatment has yielded positive results for a variety of indications, including tendon injuries and short-term pain relief (Warden SJ,
“A new direction for ultrasound therapy in sports medicine,” Sports Med. 2003; 33 (2):95-107), chronic low back pain (Ansari
NN, Ebadi S, Talebian S, Naghdi S, Mazaheri H, Olyaei G, Jalaie SA, “Randomized, Single Blind Placebo Controlled Clinical Trial
on the Effect of Continuous Ultrasound on Low Back Pain,” Electromyogr Clin Neurophysiol. 2006 Nov; 46(6):329-36) and sinusitis
(Ansari NN, Naghdi S, Farhadi M, Jalaie S, “A Preliminary Study Into the Effect of Low-Intensity Pulsed Ultrasound on Chronic Maxillary
and Frontal Sinusitis,” Physiother Theory Pract. 2007 Jul-Aug; 23(4):211-8). We believe that PainShield’s technology, portability
and ease of use may result in it becoming an attractive product in the pain management and therapy field.

Competition
for PainShield

There
are numerous products and approaches currently utilized to treat chronic pain. The pharmacological approach, which may be the most common,
focuses on drug-related treatments with the over-the-counter internal analgesic market estimated at $19 billion in 2019. Alternatively,
there are a large number of non-pharmacological pain treatment options available, such as ultrasound, transcutaneous electrical nerve
stimulation, or TENS, laser therapy and pulsed electromagnetic treatment. In addition, there are some technologies and devices in the
market that utilize low frequency ultrasound or patch technology. Many patients are initially prescribed anti-pain medication; however,
ongoing use of drugs may cause substantial side effects and lead to addiction. Therefore, patients and clinicians have shown increased
interest in alternative pain therapy using medical devices that do not carry these side effects.

25

The
currently available ultrasound treatments for chronic pain have generally been accepted by the medical community as standard treatment
for pain management. However, the traditional ultrasound treatments, such as those manufactured or distributed by Mettler Electronics
Corp, Metron USA and Zimmer MedizinSysteme, are stationary devices found only in clinics and other health care facilities that need to
be administered to patients by health care professionals. We are aware of three companies that market smaller ultrasound devices capable
of certain self-administered use for the treatment of pain: Koalaty Products, Inc., Sun-Rain System Corp. and PhysioTEC. These devices
generally function in the same manner, at the same frequency and with the same administration and safety requirements and limitations
as traditional, larger ultrasound devices. We are also aware of one product, the SAM® Sport4, which has recently received FDA approval
and also has CE Mark approval, marketed by ZetrOZ, Inc., that we understand may eliminate certain of these requirements and limitations,
namely the requirement to be plugged in, the need for movement around the treated area and the relatively short safe treatment period.
However, we understand that this product does not generate surface acoustic waves as our products do, which means that the treatment
area is generally limited to that under the transducer, that the use of transmission gel is still required, and that the transducer thickness
is significantly greater than ours (approximately 1.5cm). It is also our understanding that the FDA has issued contraindications which
do not apply to the PainShield product. In addition, there are other patch-based methods of pain treatment, such as TENS therapy. TENS
therapy may be painful and irritating for the patient due to the muscle contractions resulting from the electrical pulses.

PainShield
combines the efficacy of ultrasound treatment for pain with the ease of use and portability of a patch-based system. PainShield also
may be self-administered by the patient, including while the patient is sleeping. However, if we are unable to obtain widespread insurance
coverage and reimbursement for PainShield, its acceptance as a pain management treatment would likely be hindered, as patients may be
reluctant to pay for the product out-of-pocket.

CMS
approved PainShield for reimbursement for Medicare beneficiaries on a national basis in January 2020 although we have never received
a reimbursement value. The Company was denied reimbursement in September 2022 due to a lack of “life-cycle” testing. The
Company had engaged Carmel Labs in Israel to conduct this testing and submitted the results to CMS with our 2023 application on January
3, 2023. On August 21, 2023, CMS, denied reimbursement with respect to PainShield due to their request for additional longevity testing.
We are currently evaluating whether to resubmit another application to CMS.

Our
marketing efforts continue to expand in the direct to consumer, Veterans Health Care network, and workers’ compensation market.
Relative to the VA market, we are currently represented by Applied Medical and Delta Medical. Delta Medical is a Service Disabled Veteran
Organization Small Business (SDVOSB). PainShield is approaching the workers’ compensation market through various sales agents and
on a direct basis. Additionally, on March 1st, 2023, we established a rental program for direct to consumer marketing for
patients without health insurance coverage.

Regulatory
Strategy

PainShield
received 510(k) clearance from the FDA in August 2008 as an ultrasonic diathermy device intended to apply ultrasonic energy to generate
deep heat within body tissues for the treatment of selected medical conditions, such as relief of pain, muscle spasms, and joint contractures.
PainShield received CE Mark approval in July 2008.

In
the United States, a prescription from a licensed healthcare practitioner is required for the use of PainShield.

PainShield
Plus, also referred to as the PainShield MD Plus, is a dual applicator device that received FDA 510(k) clearance in November 2022. We
discontinued future sales of PainShield Plus following self-identification of certain inaccuracies in the 2022 510(k) application for
the PainShield Plus product. At the time we discontinued sales of PainShield Plus, we were unaware of any safety issue related to the
device, and we remain unaware of any such issues.

In
the United States, PainShield falls under the diathermy classification for the treatment of pain for initial reimbursement purposes.
The permitted reimbursement codes can be used in the outpatient supervised medical setting. We continue to work with the Centers for
Medicare and Medicaid Services and private insurers so that reimbursement can be extended to cover the administration of PainShield outside
of health care facilities and clinics. We have engaged outside legal counsel to assist with all aspects of reimbursement and FDA regulatory
actions. In addition, we intend to conduct clinical trials in order to pursue FDA authorization to market PainShield for a larger range
of indications. The targeted reimbursement would be based upon specific indications, where study data serves as justification for payment.

26

PainShield
Sales and Marketing

PainShield
was introduced in 2009 as a treatment for pain, such as tendonitis, sports injuries, pelvic pain, and neurologic pain, depending on
the scope of the approval or clearance from each applicable jurisdiction, and we have sold over 8,000 units since its introduction.
We currently maintain distribution agreements in the United States for the distribution of PainShield and continue to enhance our
marketing efforts both domestically and internationally to expand additional licensing and private label partnerships.

For
a discussion of the FDA approval process applicable to our products, as well as the regulation of our products generally, see “—Government Regulation” below.

Third
Party Reimbursement

We
anticipate that sales volumes and prices of the products we commercialize will depend in large part on the availability of coverage and
reimbursement from third party payers. Third party payers include governmental programs such as Medicare and Medicaid, private insurance
plans and workers’ compensation plans, Veterans Health Care network, among others. These third-party payers may deny coverage and
reimbursement for a product or therapy, in whole or in part, if they determine that the product or therapy was not medically appropriate
or necessary. The third-party payers also may place limitations on the types of physicians or clinicians that can perform specific types
of procedures. In addition, third party payers are increasingly challenging the prices charged for medical products and services. Some
third -party payers must also pre-approve coverage for new or innovative devices or therapies before they will reimburse health care
providers who use the products or therapies. Even though a new product may have been approved or cleared by the FDA for commercial distribution,
we may find limited demand for the device until adequate reimbursement has been obtained from governmental and private third -party payers.

In
international markets, reimbursement and healthcare payment systems vary significantly by country, and many countries have instituted
price ceilings on specific product lines and procedures. There can be no assurance that procedures using our products will be considered
medically reasonable and necessary for a specific indication, that our products will be considered cost-effective by third party payers,
that an adequate level of reimbursement will be available or that the third -party payers’ reimbursement policies will not adversely
affect our ability to sell our products profitably.

In
the United States, some insured individuals are receiving their medical care through managed care programs, which monitor and often require
pre-approval of the services that a member will receive. Some managed care programs are paying their providers on a per capita basis,
which puts the providers at financial risk for the services provided to their patients by paying these providers a predetermined payment
per member per month, and consequently, may limit the willingness of these providers to use certain products, including ours.

One
of the components in the reimbursement decision by most private insurers and governmental payers, including the Centers for Medicare
and Medicaid Services, which administers Medicare, is the assignment of a billing code. Billing codes are used to identify the procedures
performed when providers submit claims to third party payers for reimbursement for medical services. They also generally form the basis
for payment amounts.

Obtaining
reimbursement approval for a product from any government or other third -party payer is a time-consuming and costly process that could
require us or our distributors to provide supporting scientific, clinical and cost-effectiveness data for the use of our product to each
payer. Even if a code is obtained for a product, a third -party payer must still make coverage and payment determinations. When a payer
determines that a product is eligible for reimbursement, the payer may impose coverage limitations that preclude payment for some uses
that are approved by the FDA or other foreign regulatory authorities. We believe that the overall escalating costs of medical products
and services has led to, and will continue to lead to, increased pressures on the health care industry to reduce the costs of products
and services. In addition, health care reform measures, as well as legislative and regulatory initiatives at the federal and state levels,
create significant additional uncertainties. There can be no assurance that third party coverage and reimbursement will be available
or adequate, or that future legislation, regulation, or reimbursement policies of third -party payers will not adversely affect the demand
for our products or our ability to sell these products on a profitable basis. The unavailability or inadequacy of third -party payer
coverage or reimbursement would have a material adverse effect on our business, operating results and financial condition.

Effective as of January 2020, CMS approval for Medicare reimbursement was
added through Healthcare Common Procedure Coding System code K1004. We continue to work toward a favorable reimbursement rate with outside
legal counsel and reimbursement consultants.

Intellectual
Property

Intellectual
Property Related to Nano OpCo’s Business

Stemming
from a combination of patent, copyright, trademark and trade secret laws, as well as non-disclosure agreements and other contracts, our
intellectual property rights represent a vital resource to the management of our company. Therefore, we are continuing our practice of
investing in obtaining appropriate legal protection for our innovations whenever possible and have adopted a more fully integrative approach
to the management of our intellectual property that mutually aligns with our ongoing R&D strategies, commercial opportunities based
on market analyses, and longer-term business objectives.

27

From
our patented technologies to our trademarked brands, we believe our intellectual property has substantial value and has significantly
contributed to our success to date.

From
our patented technologies to our trademarked brands, we believe our intellectual property has substantial value and has significantly
contributed to our success to date.

I.
Patents

We
seek patent protection for our inventions not only to differentiate our products and technologies, but also to develop opportunities
for licensing and securing our rights to profits therefrom. With the aim of optimizing commercial and regulatory success, our proprietary
technology and innovative applications thereof are protected by a variety of patent claims. We believe that our granted patents and pending
applications collectively protect our technology, both in terms of our existing products, as well as our anticipated pipeline of new
offerings.

Our
patent portfolio includes at least the following issued patents, as well as a number of corresponding foreign patents in relevant jurisdictions:

(1)
U.S. Patent No. 7,829,029 to “Acoustic Add-On Device for Biofilm Prevention in Urinary Catheter” (expiring on August 28,
2029). Foreign counterparts include: European Patent No. 1998834 B1, and Chinese Patent No. CN 101616707 B.

(2)
U.S. Patent No. 9,028,748 to “System and Method for Surface Acoustic Wave Treatment of Medical Devices” (expiring on July
11, 2030); and

(3)
U.S. Patent No. 9,585,977 directed to “System and Method for Surface Acoustic Waves Treatment of Skin” (expiring on August
20, 2033). Foreign counterparts include: European Patent No. EP 1991129 B1, Chinese Patent No. CN 101431940 B, and Israeli Patent No.
193600.

These
patents are directed to our proprietary surface acoustic wave (SAW) technology, including our commercialized PAINSHIELD, WOUNDSHIELD,
and UROSHIELD devices and the previously commercialized PAINSHIELD PLUS. Specifically, the patents provide for methods of generating
SAW on surfaces of indwelling medical devices and to topical and urological applications therefor, for alleviating pain and for wound
healing, and for preventing formation of bacterial biofilms on catheters.

In
addition to the above patents, our pending patent applications are representative of our ongoing efforts to broaden our portfolio as
we continue to develop new applications for our ultrasound technology. Pending patent applications related to UROSHIELD devices are
directed to Multiple Frequency Surface Acoustic Waves for Internal Medical Device (US Patent Application number 19/163,046)
and System, Device, and Method for Mitigating Bacterial Biofilms Associated with Indwelling Medical Devices,) US Patent
Application number 17/646,715, in restoration process). This patent application covers the next generation of UROSHIELD devices
operating at multiple frequencies and devices which are compatible in portable and wireless systems.

Pending
patent applications related to PAINSHIELD, PAINSHIELD PLUS, WOUNDSHIELD devices are directed to Transdermal Patch of a Portable
Ultrasound-Generating System for Improved Delivery of Therapeutic Agents and Associated Methods of Treatment (US Patent
Application no. 17/025,969) and Portable Ultrasound System and Methods of Treating Facial Skin by Application of Surface Acoustic
Waves) US Patent Application number 17/646,753, in restoration process.

Although
not yet granted, the aim of our growing number of patent applications is to secure our rights within additional industry sectors we foresee
as most readily benefiting from our technology. Therefore, looking beyond just pain management and urology, our patent applications relate
to, inter alia: novel transdermal patches uniquely configured to work with our ultrasound technology to additionally provide for
improved absorption and transdermal delivery of therapeutic agents during treatment; cosmetic applications of our ultrasound technology
to provide anti-aging benefits; and certain new or improved stand-alone therapeutic medical devices or so-called “indwelling medical
devices” (e.g., catheters, intravenous (IV) needle assemblies, and percutaneous endoscopic gastronomy (PEG) tubes) that include
our SAW-generating technology to provide the accompanying antimicrobial effect for preventing infections typically associated with available
indwelling devices.

28

We
intend to further grow our patent portfolio by continuing to patent new technology as it is developed, to defend intellectual property
as we believe necessary by actively pursuing any infringements, to pursue commercial opportunities our patents provide for our innovations,
and to continue to develop our brands and trademarks.

II.
Trademarks

In
addition to patent protection, we own numerous registered trademarks for our commercialized WOUNDSHIELD (in the U.S. and Canada), NanoVibronix
(in the U.S. and Canada),

PAINSHIELD
(in the U.S. and Canada), and UROSHIELD (in the U.S.). Generally, the protection afforded by trademarks is perpetual, subject to paying
timely renewals and continuing proper use in commerce. In addition to the above, we expect to pursue additional trademark registrations
to the extent we believe they would be beneficial and cost-effective.

III.
Other
Rights

We
regularly enter into, and rely on, confidentiality and proprietary rights agreements with our employees, consultants, contractors and
business partners to protect our trade secrets, proprietary technology and other confidential information. We control the use of our
proprietary technology through relevant provisions, notifications, and disclaimers provided on our website, our customer terms of use,
and our vendor terms and conditions.

Intellectual
Property Related to ENvue Business

Below
is a brief overview of the status of ENvue’s main intellectual property assets as of February 6, 2025:

I.
Patents

ENvue
regularly protects its intellectual property rights by filing patent applications in its main target market - the USA - as well as in
the main potential target markets for its future activities. Generally, the lifespan of these patents, is 20 years from the earliest
non-provisional patent filing date. These anticipated expiration dates are without taking into account any and all possible patent term
adjustments, extensions, or abandonments, and assuming payment of all appropriate maintenance, renewal, annuity, and other governmental
fees. ENvue continues to evaluate its intellectual property portfolio as patents reach end of life to determine the optimal course for
continuing to protect its technology. ENvue owns all its patents.

Below
are details about the significant registered patents and significant patent applications owned by ENvue:

1.
Nasogastric
Tube - A tube for insertion through the patient’s nose, intended for connection to a source of substances or pressure.

Country

Status

Israel

Granted

Germany

Granted

United
States

Granted
(5 patents)

China

Granted
(2 patents)

2.
Nasogastric
Tube - A tube for insertion through the patient’s nose, intended for connection to a source of substances or pressure.
The tube contains at least one main internal tube and one suction tube, which has at least one outlet used for suction with the purpose
of preventing damage to the patient’s internal tissues.

Country

Status

Israel

Granted

United
States

Granted

3.
Nasogastric
Tube - A system that includes a tube for insertion through the patient’s nose, containing a feeding mechanism, a suction
mechanism, and a gastric decompression mechanism.

Country

Status

Europe
(Validated in AT, CH/LI, DE, ES, FR, GB, and IT)

Granted

United
States

Allowed

29

4.
Enteral
Feeding Pump - A system of devices, including a pump for drawing fluids into the tube; a switching mechanism connected to at
least four internal tubes installed in the feeding tube; and a controller designed to operate the mentioned pump and switching mechanism.

Country

Status

Israel

Granted

United
States

Granted

5.
Insertion
Device Positioning Guidance System and Method - A system and method for guiding the insertion and positioning of a device within
a patient’s body. It includes an electromagnetic field generator that covers the treatment area, multiple sensors designed
to provide indications of the tube’s position within the patient’s digestive system and the patient’s posture.
Additionally, the system features a processor that collects and processes all data to create a three-dimensional anatomical map of
the patient’s upper body, all of which functions independently of patient movement and various deviations.

Country

Status

China

Granted

Japan

Granted

United
States

Granted
(5 patents)

6.
Feeding
Tube with Electromagnetic Sensor - Feeding tubes that include an electromagnetic sensor and a wire that runs along the length
of the tube.

Country

Status

Japan

Granted

United
States

Granted
(3 patents and 1 allowed application)

7.
Insertion
Device Positioning Guidance System and Method - A system and method for guiding the insertion and positioning of a device within
a patient’s body, including an electromagnetic field generator that covers the treatment area, multiple sensors designed to
provide indications of the tube’s position within the patient’s digestive system, the patient’s posture, and other
relevant factors. The system also includes a processor that collects and processes all the data to align a predefined anatomical
map of a patient’s torso based on positions corresponding to locations on a patient’s upper body, all of which operates
independently of patient movement and other deviations.

Country

Status

Europe
(Validated in AT, CH/LI, DE, ES, FR, GB, and IT)

Granted

China

Granted
(2 patents)

Japan

Granted

United
States

Granted
(3 patents)

8.
Insertion
Device Positioning Guidance System and Method - A system and method for guiding the insertion and positioning of a device within
a patient’s body, which includes an electromagnetic field generator that covers the treatment area, multiple sensors designed
to provide indications of the tube’s position within the patient’s digestive system, the patient’s posture, and
other relevant factors. The system also includes a processor responsible for collecting and processing all the data to create a three-dimensional
anatomical map of the patient’s upper torso and to facilitate visualization on the anatomical map of a position, orientation
and/or path of a tip sensor, all of which functions independently of patient movement and other deviations.

Country

Status

China

2
Pending Applications

Japan

Granted

United
States

Granted
(4 patents)

30

9.
Insertion
Device Positioning Guidance System and Method - A device, system, and method for guiding the insertion and positioning of an
insertion tube within the patient’s body based on sensing of changes in an electromagnetic field.

Country

Status

Israel

Pending

Japan

Allowed

United
States

Pending

10.
Guidance
System with Claviculae Position Sensors - A device, system, and method for guiding the insertion and positioning of tube positioning
within the patient’s body based on sensing of changes in an electromagnetic field using sensors positioned on a patient’s
upper torso, where the calculation considers signals received from reference sensors located in the clavicle area of the patient.

Country

Status

Israel

Pending

Japan

Allowed

United
States

Pending

II.
Trademarks

As
of February 6, 2024, ENvue owns the following trademarks: Envizion Medical, ENsump, ENvue, ENgat, Envizion (wordmark and logo), and ENvue’s
logo in key countries, including the U.S., Europe, and China.

On
January 25, 2023, a request was submitted by Hologic, Inc.10 to narrow the list of goods described under the ENVIZION MEDICAL
trademark in the U.S. ENvue filed a partial voluntary surrender of its U.S. registration as to the following goods: Nasogastric aspiration
tube; Medical devices, namely, nasogastric tubes with integrated camera; Medical intubation equipment; nasogastric cameras for medical
purposes; Medical integrated camera for Nasogastric Aspiration Tubes; and Camera for placing a nasogastric tube in a patient’s
esophagus, which was accepted by the U.S. Patent and Trademark Office.

On
September 17, 2025, trademark applications for Oscar and the Oscar logo were filed in the U.S. and were approved

III.

Trade
Secrets

ENvue
also relies on trade secrets relating to its products and technology, including its data processing algorithms, and maintains the confidentiality
of such proprietary information to protect aspects of its business that are not amenable to, or that ENvue does not consider appropriate
for, patent protection. ENvue seeks to protect its trade secrets and know-how by entering into confidentiality and invention assignment
agreements with employees, contractors, consultants, suppliers, customers, and other third parties, who have access to such information.
These agreements generally provide that all confidential information concerning ENvue’s business or financial affairs developed
or made known to the individual during the course of the individual’s relationship with ENvue are to be kept confidential and not
disclosed to third parties except in specific circumstances. If any such person misappropriated ENvue’s trade secrets or other
know-how or confidential information, there is no guarantee that ENvue would be able to prevail in obtaining damages or injunctive relief
in a dispute regarding such misappropriation.

Despite
these protections, ENvue also notes that its employees may have been previously employed at other companies in the industry, including
its competitors or potential competitors. Although ENvue is not aware of any claims currently pending against it, ENvue may be subject
to claims that these employees or ENvue has inadvertently or otherwise used or disclosed trade secrets or other proprietary information
of the former employers of its employees. Litigation may be necessary to defend against these claims. Even if ENvue is successful in
defending against these claims, litigation could result in substantial costs and be a distraction to management. If ENvue fails in defending
such claims, in addition to paying money claims, ENvue may lose valuable intellectual property rights or personnel. A loss of key personnel
or their work product could hamper or prevent ENvue’s ability to commercialize product(s), which would materially adversely affect
its commercial development efforts.

IV.
Designs

As
of approximately February 6, 2025, ENvue holds design patents for Sump Tube in the U.S. and Tube Assembly for Feeding and Suction in
the U.S., Europe, the United Kingdom and China.

31

Government
Regulation

U.S.
Food and Drug Administration Regulation

Each
of our products must be approved, cleared by, or registered with the U.S. Food and Drug Administration (“FDA”) before they
can be marketed in the United States, and they can only be marketed consistently with their respective approved or cleared indication(s)
of use. Before and after approval or clearance in the United States, our products, approved or cleared products and product candidates,
are subject to extensive regulation by the FDA under the Federal Food, Drug, and Cosmetic Act and/or the Public Health Service Act, as
well as by other regulatory bodies. The FDA regulations govern, among other things, the development, testing, manufacturing, labelling,
safety, storage, record-keeping, market clearance or approval, advertising and promotion, import and export, marketing and sales, distribution
and market withdrawal and recalls of medical devices and pharmaceutical products.

FDA
Approval or Clearance of Medical Devices

In
the U.S., numerous laws and regulations govern the processes by which medical devices are developed, manufactured, brought to market
and marketed. These include the Federal Food, Drug, and Cosmetic Act (“FD&C Act”) and its implementing regulations issued
by FDA, among others. Unless an exemption applies, each medical device commercially distributed in the United States requires FDA clearance
of a 510(k) premarket notification (“510(k) clearance”), granting of a de novo request, or approval of an application for
premarket approval (“PMA”). In general, under the FD&C Act, medical devices are classified in one of three classes on
the basis of the controls necessary to reasonably assure their safety and effectiveness. A medical device’s classification determines
the level of FDA review and approval to which the device is subject before it can be marketed to consumers:

●
Class
I devices, the lowest-risk FDA device classification, include devices with the lowest risk to the patient and are those for which
safety and effectiveness can be assured by adherence to FDA’s medical device general controls, including labeling, establishment
registration, device product listing, adverse event reporting, and, for some products, adherence to good manufacturing practices
through FDA’s Quality System Regulations.

●
Class
II devices, moderate-risk devices, also require compliance with general controls and in some cases, special controls as deemed necessary
by FDA to ensure the safety and effectiveness of the device. These special controls may include performance standards, particular
labeling requirements, or post-market surveillance obligations. While most Class I devices are exempt from the 510(k) premarket notification
requirement, typically a Class II device also requires pre-market review and 510(k) clearance as well as adherence to the Quality
System Regulations/good manufacturing practices for devices.

●
Class
III devices, high-risk devices that are often implantable or life-sustaining or novel devices, also require compliance with the medical
device general controls and Quality System Regulations, and generally must be approved by FDA before entering the market through
a PMA application. Approved PMAs can include post-approval conditions and post-market surveillance requirements, analogous to some
of the special controls that may be imposed on Class II devices.

PainShield
and the ENvue System are classified as Class II medical devices and require U.S. Food and Drug Administration authorization prior to
marketing, by means of 510(k) clearance. Due to its nature and the lack of existing predicate devices on the market, UroShield is automatically
classified as a Class III device for which a PMA is required, unless our request for De Novo reclassification is successful,
in which case, it will be classified as a Class II device and subject to the same post market framework as 510(k)-cleared devices.

To
request marketing authorization by means of a 510(k) clearance, we must submit a pre-market notification demonstrating that the proposed
device is substantially equivalent to a legally marketed medical device (referred to as a “predicate device”). A finding
of substantial equivalence requires that the proposed new device (i), has the same intended use as a predicate device; (ii) has the same
or similar technological characteristics as the predicate device; (iii) is as safe and effective as the predicate device; and (iv) does
not raise different questions of safety and effectiveness than the predicate device. 510(k) submissions generally include, among other
things, a description of the device and its manufacturing, device labelling, medical devices to which the device is substantially equivalent,
safety and biocompatibility information and the results of performance testing. In some cases, a 510(k) submission must include data
from human clinical studies. Marketing may commence only when the FDA issues a clearance letter finding substantial equivalence. The
typical duration to receive 510(k) approval is approximately nine months from the date of the initial 510(k) submission, although there
is no guarantee that the timing will not be longer.

The
FDA may require us to perform clinical studies to show a product candidate’s safety and efficacy in addition to technological equivalence
in support of our filed 510(k). No matter which regulatory pathway we may take in the future towards marketing products in the United
States, we believe we will be required to provide clinical proof of device effectiveness and safety.

32

After
a device receives 510(k) clearance, any product modification that could significantly affect the safety or effectiveness of the product,
or that would constitute a significant change in intended use, requires a new 510(k) clearance or, if the device would no longer be substantially
equivalent, would require a PMA. If the FDA determines that the product does not qualify for 510(k) clearance, then a company must submit
and the FDA must approve a PMA before marketing can begin. An alternative to a new 510(k) submission is a “letter to File”,
citing substantial equivalence to a product which has been granted 510(k) clearance.

A
PMA application must provide a demonstration of safety and effectiveness, which generally requires extensive nonclinical and clinical
trial data. Information about the device and its components, device design, manufacturing and labelling, among other information, must
also be included in the PMA. As part of the PMA review, the FDA will inspect the manufacturer’s facilities for compliance with
quality system regulation requirements, which govern testing, control, documentation and other aspects of quality assurance with respect
to manufacturing. If the FDA determines the application or manufacturing facilities are not acceptable, the FDA may outline the deficiencies
in the submission and often will request additional testing or information. Notwithstanding the submission of any requested additional
information, the FDA ultimately may decide that the application does not satisfy the regulatory criteria for approval. During the review
period, an FDA advisory committee, typically a panel of clinicians and statisticians, is likely to be convened to review the application
and recommend to the FDA whether, or upon what conditions, the device should be approved. The FDA is not bound by the advisory panel
decision. While the FDA often follows the panel’s recommendation, there have been instances where the FDA has not. If the FDA finds
the information satisfactory, it will approve the PMA. The PMA approval can include post-approval conditions, including, among other
things, restrictions on labelling, promotion, sale and distribution, or requirements to do additional clinical studies post-approval.
Even after approval of a PMA, a new PMA or PMA supplement is required to authorize certain modifications to the device, its labelling
or its manufacturing process. Supplements to a PMA often require the submission of the same type of information required for an original
PMA, except that the supplement is generally limited to that information needed to support the proposed change from the product covered
by the original PMA. The typical duration to receive PMA approval is approximately two years from the date of submission of the initial
PMA application, although there is no guarantee that the timing will not be longer.

The
Food and Drug Administration Modernization Act of 1997 established a new route to market for low to moderate risk medical devices that
are automatically placed into Class III due to the absence of a predicate device, called the “Request for Evaluation of Automatic
Class III Designation,” or the De Novo classification procedure. This procedure allows a manufacturer whose novel device
is automatically classified into Class III to request down-classification of its medical device into Class I or Class II based on a benefit-risk
analysis demonstrating the device actually presents low or moderate risk, rather than requiring the submission and approval of a PMA
application. Prior to the enactment of the Food and Drug Administration Safety and Innovation Act of 2012, or FDASIA, a medical device
could only be eligible for De Novo classification if the manufacturer first submitted a 510(k) premarket notification and received
a determination from the FDA that the device was not substantially equivalent. FDASIA streamlined the De Novo classification pathway
by permitting manufacturers to request De Novo classification directly without first submitting a 510(k) premarket notification
to the FDA and receiving a not substantially equivalent determination. If the manufacturer seeks reclassification into Class II, the
manufacturer must include a draft proposal for special controls that are necessary to provide a reasonable assurance of the safety and
effectiveness of the medical device. In addition, the FDA may reject the reclassification petition if it identifies a legally marketed
predicate device that would be appropriate for a 510(k) or determines that the device is not low-to-moderate risk or that general controls
would be inadequate to control the risks and special controls cannot be developed. De Novo reclassification requests are also
subject to user fees, unless a specific exemption applies. If the device is not approved through De Novo review, then it must
go through the standard PMA process for Class III devices.

Clinical
Trials of Medical Devices

Clinical
trials are almost always required to support a PMA application and are sometimes required for a De Novo classification request
or 510(k) pre-market notification. In order to conduct a clinical investigation involving human subjects for the purpose of demonstrating
the safety and effectiveness of a medical device, an investigator acting on behalf of the company must, among other things, apply for
and obtain IRB approval of the proposed investigation. In addition, if the clinical study involves a “significant risk” (as
defined by the FDA) to human health, the company sponsoring the investigation must also submit and obtain FDA approval of an IDE. An
IDE must be supported by appropriate data, such as animal and laboratory testing results, showing that it is safe to test the device
in humans and that the testing protocol is scientifically sound. The IDE must be approved in advance by the FDA for a specified number
of study participants, unless the product is deemed a non-significant risk device and eligible for abbreviated IDE requirements. Generally,
clinical trials for a significant risk device may begin once the IDE is approved by the FDA and the study protocol and informed consent
are approved by a duly-appointed IRB at each clinical trial site.

FDA’s
IDE regulations govern investigational device labelling, prohibit promotion, and specify an array of GCP requirements, which include,
among other things, recordkeeping, reporting and monitoring responsibilities of study sponsors and study investigators. Clinical trials
must further comply with the FDA’s regulations for IRB approval and for informed consent and other human subject protections. Required
records and reports are subject to inspection by the FDA. The results of clinical testing may be unfavorable or, even if the intended
safety and efficacy success criteria are achieved, may not be considered sufficient for the FDA to grant approval or clearance of a product.

33

Post-Approval
Regulation of Medical Devices

After
a device is cleared or approved for marketing, numerous and pervasive regulatory requirements continue to apply. These include:

●
the
FDA quality systems regulation, which governs, among other things, how manufacturers design, test, manufacture, exercise quality
control over, and document manufacturing of their products;

●
labelling
and claims regulations, which prohibit the promotion of products for unapproved or “off-label” uses and impose other
restrictions on labelling;

●
if
applicable, the Electronic Product Regulations found in 21 CFR parts 1000-1050, which provide additional requirements applicable
to electronic products, including records and reporting requirements; and

●
the
Medical Device Reporting regulation, which requires reporting to the FDA of certain adverse experiences associated with use of the
product.

Under
the FDA medical device reporting (“MDR”) regulations, medical device manufacturers are required to report to the FDA information
that a device has or may have caused or contributed to a death or serious injury or has malfunctioned in a way that would likely cause
or contribute to death or serious injury if the malfunction of the device or a similar device of such manufacturer were to recur. The
decision to file an MDR involves a judgment by the manufacturer. If the FDA disagrees with the manufacturer’s determination, the
FDA can take enforcement action.

Additionally,
the FDA has the authority to require the recall of commercialized products in the event of material deficiencies or defects in design
or manufacture. The authority to require a recall must be based on an FDA finding that there is reasonable probability that the device
would cause serious adverse health consequences or death. Manufacturers may, under their own initiative, recall a product if any distributed
devices fail to meet established specifications, are otherwise misbranded or adulterated, or if any other material deficiency is found.
The FDA requires that certain classifications of recalls be reported to the FDA within ten working days after the recall is initiated.

The
failure to comply with applicable device regulatory requirements can result in enforcement action by the FDA, which may include any of
the following sanctions:

●

warning
letters, fines, injunctions, or civil penalties;

●
recalls,
detentions or seizures of products;

●

operating
restrictions;

●
delays
in the introduction of products into the market;

●
total
or partial suspension of production;

●

delay
or refusal of the FDA or other regulators to grant 510(k) clearance or PMA approvals of new products;

●
withdrawals
of marketing authorization; or

●

in
the most serious cases, criminal prosecution.

To
ensure compliance with regulatory requirements, medical device manufacturers are subject to market surveillance and periodic, pre-scheduled
and unannounced inspections by the FDA, and these inspections may include the manufacturing facilities of subcontractors and third-party
component suppliers.

Good
Manufacturing Practices Requirements

As
noted above, manufacturers of medical devices are required to comply with the good manufacturing practices set forth in the quality system
regulations promulgated under section 520 of the Food, Drug and Cosmetic Act as further set forth in the Code of Federal Regulations
as 21 CFR Part 820. Current good manufacturing practices (“CGMP”) regulations require, among other things, quality control
and quality assurance as well as the corresponding maintenance of records and documentation. The manufacturing facility for an approved
product must meet current good manufacturing practices requirements to the satisfaction of the FDA pursuant to a pre-PMA approval inspection
before the facility can be used. Manufacturers, including third party contract manufacturers, are also subject to periodic inspections
by the FDA and other authorities to assess compliance with applicable regulations. Failure to comply with or to promptly comply with
statutory and regulatory requirements subjects a manufacturer, and possibly us, to possible legal or regulatory action, including the
seizure or recall of products, injunctions, consent decrees placing significant restrictions on or suspending manufacturing operations,
and civil and criminal penalties. Adverse experiences with the product must be reported to the FDA and could result in the imposition
of marketing restrictions through labelling changes or in product recall. Product approvals may be withdrawn if compliance with regulatory
requirements is not maintained or if problems concerning safety or efficacy of the product occur following the approval.

34

International
Regulation

We
are subject to regulations and product registration requirements in many foreign countries in which we may sell our products, including
in the areas of product standards, packaging requirements, labelling requirements, import and export restrictions and tariff regulations,
duties and tax requirements. The time required to obtain clearance required by foreign countries may be longer or shorter than that required
for FDA clearance, and requirements for licensing a product in a foreign country may differ significantly from UFDA requirements.

There
is currently no premarket government review of medical devices in the European Economic Area (“EEA”). However, all medical
devices placed on the market in the EEA must meet the relevant essential requirements laid down in Annex I of Directive 93/42/EEC concerning
medical devices, or the Medical Devices Directive. The most fundamental essential requirement is that a medical device must be designed
and manufactured in such a way that it will not compromise the clinical condition or safety of patients, or the safety and health of
users and others. In addition, the device must achieve the performances intended by the manufacturer and be designed, manufactured, and
packaged in a suitable manner. The European Commission has adopted various standards applicable to medical devices. These include standards
governing common requirements, such as sterilization and safety of medical electrical equipment, and product standards for certain types
of medical devices. There are also harmonized standards relating to design and manufacture. While not mandatory, compliance with these
standards is viewed as the easiest way to satisfy the essential requirements as a practical matter. Compliance with a standard developed
to implement an essential requirement also creates a rebuttable presumption that the device satisfies that essential requirement.

In
the European Union, the European Medicines Agency and the European Union Commission determined that PainShield, UroShield, and WoundShield
are to be regulated as medical device products. These products are classified as Class II devices. These devices are CE Marked and as
such can be marketed and distributed within the European Economic Area. We are required to be recertified each year for CE by Intertek,
which conducts an annual audit. The ENvue System received a European CE mark, indicating that ENvue affirms its product’s conformity
with European health, safety and environmental protection standards, in 2021.The audit procedure, which includes on-site visits at our
facility, requires us to provide Intertek with information and documentation concerning our management system and all applicable documents,
policies, procedures, manuals, and other information.

On
April 5, 2017, the European Parliament passed the Medical Devices Regulation (Regulation 2017/745), which repeals and replaces the EU
Medical Device Directive and became effective on May 26, 2021. The Medical Devices Regulation, among other things, is intended to establish
a uniform, transparent, predictable, and sustainable regulatory framework across the EEA for medical devices and ensure a high level
of safety and health while supporting innovation. The new regulations, among other things:

●
strengthen
the rules on placing devices on the market and reinforce surveillance once they are available;

●
improve
the traceability of medical devices throughout the supply chain to the end-user or patient through a unique identification number;

●
set
up a central database to provide patients, healthcare professionals, and the public with comprehensive information on products available
in the E.U.; and

●
strengthen
rules for the assessment of certain high-risk devices, such as implants, which may have to undergo an additional check by experts
before they are placed on the market.

The
primary regulatory bodies and paths in Asia, Australia, and Latin America are determined by the requisite country authority. In most
cases, establishment registration and device licensing are applied for at the applicable Ministry of Health through a local intermediary.

European
Good Manufacturing Practices

In
the European Union, the manufacture of medical devices is subject to good manufacturing practice, as set forth in the relevant laws and
guidelines of the European Union and its member states. Compliance with good manufacturing practice is generally assessed by the competent
regulatory authorities. Typically, quality system evaluation is performed by a notified body, which also recommends to the relevant competent
authority for the European Community CE Marking of a device. The competent authority may conduct inspections of relevant facilities,
and review manufacturing procedures, operating systems and personnel qualifications. In addition to obtaining approval for each product,
in many cases each device manufacturing facility must be audited on a periodic basis by the notified body. Further inspections may occur
over the life of the product.

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U.S.
Fraud and Abuse and Other Health Care Laws

In
the United States, federal and state fraud and abuse laws prohibit the payment or receipt of kickbacks, bribes or other remuneration
intended to induce the purchase or recommendation of health care products and services. Other provisions of federal and state laws prohibit
presenting, or causing to be presented, to third party payers for reimbursement, claims that are false or fraudulent, or which are for
items or services that were not provided as claimed. In addition, other health care laws and regulations may apply, such as transparency
and reporting requirements, and privacy and security requirements. Violations of these laws can lead to civil and criminal penalties,
including exclusion from participation in federal and state health care programs. These laws are potentially applicable to manufacturers
of products regulated by the FDA as medical devices, such as us, and hospitals, physicians and other potential purchasers of such products.
The health care laws that may be applicable to our business or operations include:

●

Federal
false claims laws and civil monetary penalty laws, including the False Claims Act, that prohibit,
among other things, individuals or entities from knowingly presenting, or causing to be presented,
claims for payment from Medicare, Medicaid or other government health care programs that
are false or fraudulent, or making a false statement to avoid, decrease or conceal an obligation
to pay money to the federal government.

●

The
federal Anti-Kickback Statute, which prohibits the offer, payment, solicitation or receipt
of any form of remuneration in return for referring, ordering, leasing, purchasing or arranging
for, or recommending the ordering, purchasing or leasing of, items or services payable by
Medicare, Medicaid or any other federal health care program

●
The
federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which prohibits knowingly and willfully executing,
or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses,
representations, or promises, any of the money or property owned by, or under the custody or control of, any health care benefit
program, and for knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statements
in connection with the delivery of or payment for health care benefits, items or services.

●
HIPAA,
as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, and its implementing regulations, which
also impose obligations and requirements on health care providers, health plans, and healthcare clearinghouses as well as their respective
business associates that perform certain services for them that involve the use or disclosure of individually identifiable health
information, with respect to safeguarding the privacy and security of certain individually identifiable health information.

●
The
federal transparency requirements under the Affordable Care Act, including the provision commonly referred to as the Physician Payments
Sunshine Act, which requires certain manufacturers of drugs, devices, biologics and medical supplies that are reimbursable under
Medicare, Medicaid or Children’s Health Insurance Program to report annually to Centers for Medicare and Medicaid Services,
or CMS, information related to payments and other transfers of value to physicians and teaching hospitals, and ownership and investment
interests held by physicians and their immediate family members.

●
Analogous
state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may be broader in scope and apply
to referrals and items or services reimbursed by both governmental and non-governmental third-party payers, including private insurers,
many of which differ from each other in significant ways and often are not pre-empted by federal law, thus complicating compliance
efforts.

Health
Information Privacy and Security Laws

There
are numerous U.S. federal and state laws and regulations related to the privacy and security of Personally Identifiable Information (“PII”),
including health information. Among others, the federal Health Insurance Portability and Accountability Act of 1996, as amended by HITECH,
and their implementing regulations, which we collectively refer to as HIPAA, establish privacy and security standards that limit the
use and disclosure of Protected Health Information (“PHI”) and require covered entities and business associates to implement
administrative, physical, and technical safeguards to ensure the confidentiality, integrity, and availability of individually identifiable
health information in electronic form, among other requirements.

Violations
of HIPAA may result in civil and criminal penalties. Our hospital customers are typically covered entities under HIPAA, and we are therefore
limited in the health information we may collect, receive, use, and disclose. To the extent we provide services that require the use
of PHI, we may be business associates of such covered entities and directly subject to HIPAA.

State
attorneys general also have the right to prosecute HIPAA violations committed against residents of their states, and HIPAA standards
have been used as the basis for the duty of care in state civil suits, such as those for negligence or recklessness in misusing personal
information. In addition, HIPAA mandates that HHS conduct periodic compliance audits of HIPAA covered entities and their business associates
for compliance.

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Many
states also have laws that protect the privacy and security of sensitive and personal information, including health information. These
laws may be similar to or even more protective than HIPAA and other federal privacy laws. For example, the laws of the State of California
are more restrictive than HIPAA. Where state laws are more protective than HIPAA, we must comply with the state laws we are subject to.
California passed the California Consumer Privacy Act or CCPA on June 28, 2018, which went into effect January 1, 2020. On November 3,
2020, the California Privacy Rights Act of 2020 (“CPRA”), which amends the CCPA and adds new privacy protections that became
effective on January 1, 2023, was enacted through a ballot initiative. Records and information we maintain on our patients may be subject
to the CCPA if it is not covered by HIPAA. In certain cases, it may be necessary to modify our planned operations and procedures to comply
with these more stringent state laws. Not only may some of these state laws impose fines and penalties upon violators, but also some,
unlike HIPAA, may afford private rights of action to individuals who believe their personal information has been misused. In addition,
state and federal privacy laws are subject to frequent change.

In
addition to HIPAA and state health information privacy laws, we may be subject to or restricted by other state and federal privacy laws,
including laws that prohibit unfair privacy and security practices and deceptive statements about privacy and security, laws that place
specific requirements on certain types of activities, such as data security and texting, and laws requiring holders of personal information
to maintain safeguards and to take certain actions in response to a data breach.

Foreign
data protection, privacy, and other laws and regulations are often more restrictive than those in the U.S. The E.U., for example, traditionally
has imposed stricter obligations under its laws and regulations relating to privacy, data protection and consumer protection than the
U.S. In May 2018, the GDPR, governing data practices and privacy in the E.U., became effective and replaced the data protection laws
of the individual member states. GDPR requires companies to meet stringent requirements regarding the handling of personal data of individuals
in the E.U. These more stringent requirements include expanded disclosures to inform members about how we may use their personal data,
increased controls on profiling members, and increased rights for members to access, control and delete their personal data. In addition,
there are mandatory data breach notification requirements. The law also includes significant penalties for non-compliance, which may
result in monetary penalties of up to 20 million Euros or 4% of a company’s worldwide turnover, whichever is higher. GDPR and other
similar regulations require companies to give specific types of notice and informed consent is required for the placement of a cookie
or similar technologies on a user’s device for online tracking for behavioral advertising and other purposes and for direct electronic
marketing, and the GDPR also imposes additional conditions in order to satisfy such consent, such as a prohibition on pre-checked consents.
It remains unclear how the U.K. data protection laws or regulations will develop in the medium to longer term and how data transfer to
the U.K. from the E.U. will be regulated. Outside of the E.U., there are many other countries with data protection laws, and new countries
are adopting data protection legislation with increasing frequency.

Many
of these laws may require consent from individuals for the use of data for various purposes, including marketing, which may reduce our
ability to market our products.

There
is no harmonized approach to these laws and regulations globally. Consequently, we increase our risk of non-compliance with applicable
foreign data protection laws and regulations when we expand internationally. We may need to change and limit the way we use personal
information in operating our business and may have difficulty maintaining a single operating model that is compliant. Compliance with
such laws and regulations will result in additional costs and may necessitate changes to our business practices and divergent operating
models, limit the effectiveness of our marketing activities, adversely affect our business, results of operations, and financial condition,
and subject us to additional liabilities.

Manufacturing
and Suppliers

ENvue
Products

ENvue
does not manufacture the products it sells. ENvue has contracted with suppliers for the supply of raw materials and various components
that make up the system, as well as for the assembly of the system and the specialized feeding tubes.

We
estimate that there may be a limitation on the potential annual production capacity at the supplier that assembles the ENvue System.
ENvue’s management previously estimated that it can contract with an additional manufacturer if necessary. It should also be noted
that several companies with a global presence provide similar services to those of the current manufacturer, and ENvue previously estimated
that, if necessary, it could replace or expand the existing assembly capabilities within 6-9 months without significant cost changes.
customers.

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Additionally,
there are only a few manufacturers worldwide that produce feeding tubes (made of polyurethane) used by ENvue to produce the specialized
feeding tubes for the ENvue System. Accordingly, terminating the contract with our feeding tube supplier could affect the production
capacity for the ENvue System for the time required to reorganize until we contract with an alternative supplier.

Nano
OpCo’s Products

For
the year 2025, through the current date, all of our programming and disposable kit manufacturing are being performed in our facilities
in Israel.

We
order certain component parts on an as-needed basis, generally from the manufacturer that provides us with the most competitive pricing.
Our most significant suppliers for these components are B Star, Inc and Plastic One. We do not have written agreements with any of these
suppliers, but we believe anyone could be replaced if necessary.

Customers

We
currently sell our products both directly through our website and indirectly via distribution agreements, with approximately 98% of our
sales coming through distributors and customers who are referred to us through sales agents, and the remaining 2% from consumers who
contact us through our website. We have exclusive and non-exclusive distribution agreements for our products with medical product distributors
based in the United States, in the United Kingdom and various countries throughout Europe, Australia, New Zealand, and Malta. For the
year ended December 31, 2025, our largest customer was Ultra Pain Products Inc, to whom our sales of products to them comprised approximately
31% of our total revenues.

We
are currently in discussions with several distribution companies with access to various markets in the United States, Europe, and Asia,
as well as the Veterans Health Care network facilities. Our current agreements stipulate that distributors will be responsible for carrying
out local marketing activities and sales. In addition, in most cases, all sales costs, including sales representatives, incentive programs, and marketing trials, will
be borne by the distributor. We expect any future distribution agreements to contain substantially similar stipulations. Under our current
agreements, distributors purchase our products from us at a fixed price. Our current agreements with distributors are generally for a
term of approximately two to three years and automatically renew for additional annual terms unless modified by either party. We also
service patients directly as a result of independent sales agents.

Our
People and Human Capital Resources

Employees

As
of December 31, 2025, ENvue has 12 full-time employees and 2 part-time employees. We also regularly work with several independent
consultants and other contract organizations to support our business and we regularly evaluate additional talent to help support our
product manufacturing, development, financial, and other capabilities.

Diversity
and Inclusion

We
believe that an inclusive culture is required to understand and develop products that benefit all patients. By embracing differences,
we aim to foster an environment of respect and trust in an effort to facilitate creativity, spark passion, and help us achieve better
outcomes for all those who work at the Company. We are committed to creating and maintaining a workplace free from discrimination or
harassment, including on the basis of any class protected by applicable law, and our recruitment, hiring, development, training, compensation,
and advancement practices are based on qualifications, performance, skills, and experience without regard to gender, race, or ethnicity.
Our management team and employees are expected to exhibit and promote honest, ethical, and respectful conduct in the workplace, including
adhering to the standards for appropriate behavior set forth in our code of conduct.

Compensation
and Benefits

We
operate in a highly competitive environment for human capital, particularly as we seek to attract and retain talent with relevant experience
in the medical device sector. Therefore, we strive to provide a total rewards package to our employees that is competitive with our peer
companies, including competitive healthcare benefits and in certain cases, stock options. We also offer paid leave as mandated by government
regulations, flexible work schedules, and other benefits as mandated by government regulations.

We
also offer employees the benefit of equity ownership in ENvue through stock option grants. We believe these grants both help promote
alignment between our employees and our stockholders and provide retention benefits, as the awards generally vest over a three-year period.

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We
do not have any employees that are represented by a labor union or that have entered into a collective bargaining agreement with the
Company.

Safety
and Wellness

At
ENvue, we believe that health matters to everyone, and the safety health, and wellness of our employees is one of our top priorities.
We are committed to developing and fostering a work environment that is safe, professional, and promotes teamwork, diversity, and trust
in order to afford all of our employees the opportunity to contribute to the best of their abilities.

Seasonality

The
Company’s field of activity is not characterized by seasonality. It should be noted that hospitals, which are the current and potential
customers of the ENvue System, tend to concentrate their purchases of medical equipment in the last quarter of the year (end of the fiscal
year).

Legal
Proceedings

From
time to time, we may become party to legal proceedings in the ordinary course of business. Such legal proceedings may negatively impact
our business and financial position, result in brand or reputational harm, and divert the attention of our management from core operations
of our business.

Protrade
Proceeding

On
February 26, 2021, Protrade Systems, Inc. (“Protrade”) filed a Request for Arbitration (the “Request”) with the
International Court of Arbitration (the “ICA”) of the International Chamber of Commerce alleging the Company is in breach
of an Exclusive Distribution Agreement dated March 7, 2019 (the “Agreement”) between Protrade and the Company. Protrade alleges,
in part, that the Company has breached the Agreement by discontinuing the manufacture of the DV0057 Painshield MD device in favor of
an updated 10-100-001 Painshield MD device. Protrade claims damages estimated at $3 million. The Company vigorously defended the claims
asserted by Protrade.

On
March 15, 2022, the arbitrator issued a final award, which, determined that (i) the Company had the right to terminate the Exclusive
Distribution Agreement; (ii) the Company did not breach the duty of good faith and fair dealing with regard to the Exclusive Distribution
Agreement; and (iii) the Company did not breach any confidentiality obligations to Protrade. Nevertheless, the arbitrator determined
that the Company did not comply with the obligation to supply Protrade with a year’s supply of patches, and awarded Protrade $1,500,250,
which consists of $1,432,000 for “lost profits” and $68,250 as reimbursement of arbitration costs, on the grounds that the
Company allegedly failed to supply Protrade with certain patches utilized by users of DV0057 Painshield MD device. The arbitrator based
the decision on the testimony of Protrade’s president who asserted that a user would use in excess of 33 patches per each device.
The Company believes that the number of patches per device alleged by Protrade is grossly inflated, and that these claims were not properly
raised before the arbitrator. Accordingly, on April 13, 2022, the Company submitted an application for the correction of the award which
the arbitrator denied on June 22, 2022.

On
April 5, 2022, Protrade filed a Petition with the Supreme Court of New York Nassau County seeking to confirm the Award. On April 13,
2022, the Company submitted an application to the ICA seeking to correct an error in the award based on the evidence that the Company
only sold 2-3 reusable patches per device contrary to the 33 reusable patches claimed by Protrade. The same arbitrator who issued the
award, denied the application.

On
July 22, 2022, the Company filed a cross-motion seeking to vacate arbitration award on the grounds that the arbitrator exceeded her authority,
that the award was procured by fraud, and that the arbitrator failed to follow procedures established by New York law. In particular,
the Company averred in its motion that Protrade’s witness made false statements in arbitration, and that the arbitrator resolved
a claim that was never raised by Protrade and that has no factual basis.

On
October 3, 2022, the court issued a decision granting Protrade its petition to confirm the award and denying the cross-motion.

On
November 9, 2022, the Company filed a motion to re-argue and renew its cross-motion to vacate the arbitration decision based on newer
information that was not available during the initial hearing. On the same day, the Company also filed a notice of appeal with the Appellate
Division, Second Department. On March 21, 2023, the court denied the motion to re-argue and renew.

39

On
July 10, 2023, the Company filed its appeal with the Appellate Division, Second Department. That
appeal is now fully briefed. In February 2025, the Second Department informed counsel for the Company that the Second Department was
beginning to process the appeal for calendaring.

On
March 30, 2026, the Appellate Division of the Second Department issued a decision and order which affirmed the judgment of the Supreme
Court, Nassau County in its entirety and dismissed the appeal, stating inter alia that “NanoVibronix failed to establish that the
arbitration award violated a strong public policy, was irrational, procured by fraud, or clearly exceeded a specifically enumerated limitation
of the arbitrator’s power”. It further held that NanoVibronix had not demonstrated that it had shown sufficient new facts
to the court on the motion to renew. The decision was conclusory and did not analyze the facts as argued by NanoVibronix nor did it distinguish
them specifically. The Company is currently reviewing the decision and considering its available alternatives.

As
of December 31, 2025, and 2024, the Company accrued the amount of the arbitration award to Protrade of approximately $2.3 million and
$2.1 million, respectively, including interest which is classified in “Other accounts payable and accrued expenses”.

Initiation
of Insolvency Proceedings Against Predecessor ENvue

During
2023, Predecessor ENvue was involved in the development of components and products to improve and upgrade the system as part of its research
and development activities, in order to optimize its use, expand its advantages and capabilities, and increase the potential target market.
As part of efficiency processes and cost-cutting measures in Predecessor ENvue, as of July 2023, Predecessor ENvue ceased its research
and development activities. The activities were resumed following the purchase by ENvue Holdings Corp.

Available
Information

The
Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments thereto, are
filed with the Securities and Exchange Commission (the “SEC”). The Company is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and files or furnishes reports, proxy statements and
other information with the SEC. Such reports and other information filed by the Company with the SEC are available free of charge on
the Company’s website at www.envuemed.com, as soon as reasonably practicable after we have electronically filed with, or
furnished to, the SEC. The SEC maintains an internet site that contains reports, proxy and information statements and other information
regarding issuers that file electronically with the SEC at www.sec.gov. The contents of these websites are not incorporated into
this filing. Further, the Company’s references to website URLs are intended to be inactive textual references only.

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